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S E C O N D E D I T I O N

St r at egi es f or Heal t hcar e


Achieving
Service
Excellence
ACHE Management Series Editorial Board
Kristin L. Schmidt, RN, FACHE, Chair
West Valley Hospital
Mark C. Brown
Lake City Medical CenterMayo Health System
Robin B. Brown Jr., FACHE
Scripps Green Hospital
Ronald A. Charles, MD, FACHE
Buckeye Community Health Plan
Frank A. Corvino, FACHE
Greenwich Hospital
Terence T. Cunningham III, FACHE
Shriners Hospital for Children
Joseph J. Gilene, FACHE
Carolinas Healthcare System
Kent R. Helwig, FACHE
UT Southwestern Medical Center
Trudy L. Land, FACHE
Executive Health Services
James J. Sapienza, FACHE
MultiCare Health System
Leticia W. Towns, FACHE
Atlanta, GA
Donald B. Wagner, LFACHE
Sugar Land, TX
S E C O N D E D I T I O N
St r at egi es f or Heal t hcar e
Achieving
Service
Excellence
Myron D. Fottler
Robert C. Ford
Cherrill P. Heaton
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Fottler, Myron D.
Achieving service excellence : strategies for healthcare / Myron D.
Fottler, Robert C. Ford, and Cherrill P. Heaton. -- 2nd ed.
p. cm.
Includes index.
ISBN 978-1-56793-327-7 (alk. paper)
1. Medical care--Customer services. 2. Patient satisfaction. 3.
Customer relations. I. Ford, Robert C. (Robert Clayton), 1945- II.
Heaton, Cherrill P. III. Title.
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2009037788
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Contents
Foreword by Quint Studer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
Preface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .xv
Part I The Service Strategy
Chapter 1 Customer Satisfaction as Competitive Advantage. . . . . . . . . . . . . 3
Chapter 2 The Customer as Guest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Chapter 3 Enhancing Customer Service Through Planning . . . . . . . . . . . . 51
Chapter 4 Creating a Healing Environment . . . . . . . . . . . . . . . . . . . . . . . . 79
Chapter 5 Developing a Culture of Customer Service . . . . . . . . . . . . . . . 105
Part II The Service Staff
Chapter 6 Stafng for Customer Service. . . . . . . . . . . . . . . . . . . . . . . . . . 131
Chapter 7 Customer Service Training. . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
Chapter 8 Motivation and Empowerment . . . . . . . . . . . . . . . . . . . . . . . . 189
Chapter 9 Involving the Patient and Family in Coproduction . . . . . . . . . 217
Part III The Service System
Chapter 10 Communicating Information Internally and Externally . . . . . . 239
Chapter 11 Delivering the Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271
Chapter 12 Waiting for Healthcare Service. . . . . . . . . . . . . . . . . . . . . . . . . 299
Chapter 13 Measuring the Quality of the Healthcare Experience . . . . . . . . 331
Chapter 14 Fixing Healthcare Service Failures . . . . . . . . . . . . . . . . . . . . . . 359
Chapter 15 Leading the Way to Healthcare Service Excellence . . . . . . . . . . 383
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 411
Index. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431
About the Authors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
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vii
Foreword
Quint Studer, Founder, The Studer Group
When Myron Fottler and Bob Ford asked me to write the Foreword for this
book, just as I had for the rst edition seven years ago, I agreed. This second edi-
tion of Achieving Service Excellence has been substantially updated to reect the
new realities in the healthcare industry. While healthcare workers still need to feel
a sense of purpose, still seek opportunities to do worthwhile work, and still desire
to make a difference, the environment in which they deliver the healthcare experi-
ence has changed.
Direct caregivers and support staff share a great feeling of accomplishment in
seeing a patient get better, in being recognized by family members for preserv-
ing the dignity of their ill or dying loved one, and in hearing positive comments
in the community about their work particularly and their organization generally.
Conversely, each healthcare worker feels great sadness in knowing that a patient,
a family member, or another customer is not satised with the service provided.
Although patients today may nd it difcult, if not impossible, to measure the
effectiveness of clinical interventions, they know what to expect from all other
aspects of the care experience. Patients and families scrutinize the courteous man-
ner of the staff, the length of wait times, the speed of admission or discharge, the
responsiveness to questions and complaints, the quality of the food, the cleanliness
of the facility, and the instructions and information given for self-care.
In the last 20 years or so, something happened to the essence of healthcare.
Formerly focused on caregiving, healthcare is now caving to the pressures of the
bottom line. On a daily basis, healthcare leaders are bombarded with reimburse-
ment cuts, labor shortages, revenue losses, complicated regulations, and medical
staff challenges, among a multitude of crises. Boards of directors can go for months
without discussing patient issues at their meetings.
At the beginning of the movie Its a Wonderful Life, two characters in heaven
are talking. One says to the other, You have to go down to earth and help George
Bailey. The other replies, Why, is he in trouble? The rst responds, Even worse.
He is discouraged. In my travels around the country to help healthcare organiza-
tions improve their delivery of the patient experience, the word discouraged seems
an appropriate description for how patients, families, physicians, leaders, and staffs
feel about the state of healthcare service today. We all wonder, What happened
to healthcares core function? What role did cuts in Medicare reimbursement, the
introduction of HIPAA, increases in pharmaceutical costs, and other issues play in
this imbalance?
All of these factors have had an impact, but the number one culprit, in my
opinion, has been the failure of healthcares leaders to make patient, employee, and
physician satisfaction a priority. Maybe many executives did not adopt this focus
because it seemed to be common sense for a hospital or clinic to pay attention to
these three groups. But common sense is often very uncommon. I know it was
for me.
As a healthcare leader, I was guilty of moving away from patient and staff in-
teraction. Managed care negotiations, program development, mergers, consolida-
tions, cash collection, and debt nancing all crowded out my time, providing me
with rationalizations. In 1993, as the senior vice president and chief operating of-
cer of an inner-city hospital in Chicago called Holy Cross Hospital, I was put in
charge of patient satisfaction. After some false starts, I surrendered, not knowing
what to do, so I sought help. I visited nonhealthcare companies with great service
reputations, but most important of all, I asked the staff what to do and listened.
Those steps kick-started my journey back to why I entered healthcare.
At rst I was worried that our satisfaction efforts would take away from our bot-
tom line. But soon, I realized that our new focus led us to a better understanding
of employees and physicians and that in order to achieve great patient satisfaction,
we rst had to address employee and physician issues. As each month went by, I
learned more. As employee satisfaction increased, employee turnover decreased. A
stable workforce reduced the length of stay and improved both patient and physi-
cian satisfaction. These outcomes boosted our patient volume and gave us bet-
ter leverage with managed care companies. Most surprising of all my discoveries
was that not focusing on the bottom line increased the bottom line, and did so
dramatically. The results our team at Holy Cross achieved garnered the hospital
numerous awards, including the American Hospital Associations Great Comeback
Award in 1994.
In June 1996, I took the lessons learned at Holy Cross and other hospitals to
Baptist Hospital, Inc. (now Baptist Health Care) in Pensacola, Florida. At Bap-
tist, the approach of focusing on satisfaction rather than on the bottom line also
worked. As more hospitals benchmarked our practices at Baptist and as I spoke
about our achievements throughout the country, I began to put together the must
haves for patient satisfaction. These pillars or principles produced tremendous
results for Baptist: It ranked in the top 1 percent of organizations for patient sat-
viii Foreword
isfaction, and it placed rst in employee satisfaction and quality. In 2000, Baptist
received USA Todays Quality Cup. In 2002, Baptist was named by Fortune as one
of the Top 10 Places to Work, showing that service principles stick if hardwired
into the culture. While at Baptist, I developed a seminar to give myself an op-
portunity to share my ideas with other leaders. This seminar led me to establish a
coaching business, which allows me to make an even greater difference in the eld
of patient satisfaction.
What I have learned and continue to learn is this: Leadership matters a lot, a
truth detailed in my recent book Results That Last. Every healthcare organization
must identify and then study the causes of its success. Its leaders must realize that
to improve patient, staff, and physician satisfaction, the organization must return
to its core values of serving a purpose, doing worthwhile work, and making a dif-
ference. This book, as was the last edition, is deceptive because although it is easy
and fun to read, it is lled with customer satisfaction theories and applications.
It presents current examples and trends and offers the latest research. I especially
appreciate the Service Strategies sections, which enumerate the patient-focused
concepts discussed in each chapter. These strategies can help healthcare executives
improve their satisfaction efforts, especially in todays highly competitive environ-
ment and with highly informed consumers. Both patients and employees know
who is doing a good job and who is not.
I hope you enjoy this new edition. The authors worked hard to provide new
takeaways. Although the authors have won awards from the American Academy of
Medical Administrators, they should be recognized as well for making a difference
in the healthcare eld. As George Bailey ultimately learned in Its a Wonderful
Life, we all should never underestimate the difference we can make.
Foreword ix
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xi
Preface
Like the first edition, Achieving Service Excellence: Strategies for Healthcare,
second edition, presents and organizes the available best practices and information
related to the provision of a superb total healthcare experience. Current trends,
research, and examples are included throughout, offering readers a foundation for
understanding the concepts discussed.
The book is designed to help executives and managers implement a customer-
focused service strategy in todays customer-driven market. The book may also be
used, as we have used it, as a primary text in both academic and executive educa-
tion programs, as it covers the theories, methods, and techniques behind multiple
aspects of customer service excellence.
Each chapter of this book is anchored on a service principle that has proven to
work inside and outside the healthcare industry; see the inside cover for a complete
list of these principles. These principles are the key strategies followed by bench-
mark organizations that use service as a competitive advantage and distinguish
themselves from competitors that are merely good.
BOOK CONTENT
The book is divided into three partsService Strategy, Service Staff, and Service
Systems. Each component is an important contributor to the ultimate goal of
meeting and exceeding the needs, wants, and expectations of internal and external
customers.
Strategy (Part I) is the set of plans for fullling the organizations mission and
vision, engendering its values and culture, and achieving its goals. All service efforts
are based on this strategy. Part I comprises chapters 1 through 5 and covers many
topics, including the following:
The current market reality, including more informed and more demanding
patients, and the practice of guestology
xii Preface
The three components of the total healthcare experience: service product,
service setting, and service delivery system
The strategic planning process as it relates to the service strategy
Environmental assessment, alignment audit, and action plans
Quantitative and qualitative forecasting tools
Evidence-based design and the healing environment
The customer-focused culture
Stafng (Part II) represents the human resources activities that yield the person-
nel who develop, implement, improve, and monitor the strategy. Part II contains
chapters 6 through 9 and addresses issues such as the following:
Job analysis and personorganization ft
Recruitment, selection, and retention
Leader and staff development and training
Employee empowerment, motivation, and rewards
Coproduction of healthcare services
Systems (Part III) refer to the processes, policies, standards, and other practices
that support the strategy and the staff. Part III includes chapters 10 through 15 and
explores various concepts, including the following:
Health information systems
Blueprinting, fshbone analysis, Program Evaluation Review Technique/
Critical Path Method (PERT/CPM), and simulations
Wait times and the psychology of waiting (perception versus reality)
Measurement and feedback methods
Recovering from and preventing service failures
Service excellence model
Finally, all chapters end with Service Strategieskey points to remember from
the chapter discussion as well as our recommendations for action. In this edition,
sidebars that pertain to a concept have been included in most chapters, and all
references have been moved to the back of the book to facilitate reading.
Preface xiii
CONCLUSI ON
Often, the total healthcare experience in many facilities is less than ideal, causing
dissatisfaction of all stakeholders and driving patients to defect to competing pro-
viders. Patients and their families no longer just need, want, and expect a positive
clinical outcome; they also need, want, and expect great quality and great value
from the service experience. These customers are taking advantage of Web-based
information and tools to make all kinds of healthcare decisions. They know who
does what well and who is falling behind. All other stakeholders, including clini-
cians and employees, are similarly informed.
This book is a comprehensive guidebook for delivering an excellent total health-
care experience.
Myron D. Fottler, PhD
Robert C. Ford, PhD
Cherrill P. Heaton, PhD
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xv
Acknowledgments
We thank many people for reading our manuscript and offering suggestions for
inclusion in the second edition. Their insightful comments added great value to
this book.
Myron Fottler thanks his wife, Carol, for her patience during the approximately
18-month period of manuscript preparation. He also thanks his students in the
Masters in Health Services Administration program at the University of Central
Florida (UCF) who contributed ideas for this book and suggested improvements;
specically, he thanks Megan McLendon, whose assistance was crucial in the prep-
aration of the nal manuscript. Last, he thanks Dr. Aaron Liberman, chair of the
Department of Healthcare Management and Informatics at UCF, for his support
of this project.
Robert Ford thanks his wife, Barbara, for her patient support throughout this
project. Her tolerance, understanding, and help during the production of this book
are greatly appreciated. Also, he acknowledges and thanks his guestology mentor
Bruce Laval, former senior vice president of planning and operations at The Walt
Disney Company, for his willingness to share his incredible knowledge on manag-
ing outstanding guest service organizations.
Cherrill Heaton thanks his wife Marieta for her help and support. He also
thanks Dr. Allen Tilley for his support and encouragement.
The authors thank the acquisitions staff at Health Administration Press
(HAP)Janet Davis, Eileen Lynch, and Audrey Kaufman (former acquisitions
manager at HAP)for their encouragement, support, and patience. We also thank
Jane Calayag, editor at HAP, for her editorial assistance in shortening and focusing
the manuscript.
We also extend our gratitude to Quint Studer. He inspired us to put together
our collective knowledge of and experience in excellent customer service and to
share them with the healthcare management eld. Finally, we thank readers who
have sent us comments and suggestions. We appreciate all of these ideas and have
included those that t the framework of this second edition.
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P A R T I
The Service Strategy
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3
Whatever your discipline, become a student of excellence in all things. Take every
opportunity to observe people who manifest the qualities of mastery. These models of
excellence will inspire you and guide you toward the fulllment of your highest potential.
Michael Gelb and Tony Buzan
C H A P T E R 1
Customer Satisfaction as Competitive Advantage
Service Principle:
Identify and manage all aspects of the healthcare experience
In this chapter, we address the following:
The rise of the informed, empowered healthcare customer
The needs, wants, and expectations of todays patients
The healthcare market trends driven by knowledgeable customers
The state of customer service in healthcare
The ways by which benchmark service companies and cutting-edge healthcare
organizations are responding to the current market reality.
Also, we enumerate and describe the three conceptsfocus on the customer, treat
the customer like a guest, and manage the total healthcare experiencethat serve
as the foundation for the 15 principles of achieving service excellence. Each chap-
ter in this book explores one of these principles.
A WORD ABOUT TERMI NOLOGY
Both the traditional healthcare term patient and the general term customer are used
throughout the book. But these words are not interchangeable because all patients
are customers, but not all customers are patients.
4 Achieving Service Excellence
For our purposes, we dene these terms as follows:
Patients are those who directly receive either clinical services from healthcare
providers or processing services from third-party payers.
Customers refer to anyone with whom the organization conducts a
transaction. In healthcare, patients are the primary customers. The secondary
customers include physicians and other clinicians, family members of patients,
visitors, third-party payers, vendors, and support and ancillary staff.
Throughout this book, we use patients to refer to the actual recipients of health-
care services and customers to indicate all categories of healthcare consumers.
Although the word guest is introduced in Chapter 2, it is typically associated with
the hospitality industry. However, the most successful healthcare organizations treat
their customers like guests. Regardless of the term used, the idea is to exceed the expec-
tations of all customers by treating each of them as an honored guest.
THE RI SE OF THE HEALTHCARE CUSTOMER
The healthcare industry is made up of organizations that (1) provide healthcare
and related services and (2) pay for and regulate the delivery of those services. This
diverse industry includes hospitals, health systems, outpatient and retail clinics,
medical practices, nursing homes, public and private regulatory agencies, managed
care companies, and other third-party payers.
Because the principles and practices presented in this book apply to a wide
range of settings, this expanded concept of the healthcare industry is our frame-
work throughout the book.
A Shift in Stakeholder Focus
Historically, healthcare organizations have concentrated on meeting the expecta-
tions of their key stakeholdersmedical staffs and third-party payers (Blair and
Fottler 1990; Fottler et al. 1989). Because most physicians are afliated with more
than one hospital, they have the power to decide where their patients receive
healthcare services. Thus, healthcare organizations go to great lengths to make their
medical staffs and other physicians in the community happy. Because third-party
payers, rather than patients, pay most of the bills, organizations expend consider-
able effort in satisfying them as well. To retain the approval of third-party payers,
healthcare managers focus on increasing market share, restructuring, decreasing
Chapter 1: Customer Satisfaction as Competitive Advantage 5
costs, and increasing revenues; to please their medical staffs, managers provide
sophisticated technology and in-house amenities.
Patients are also key stakeholders and hence need to be satisfed. Tradition-
ally, however, managers have focused on meeting patients clinical needs, not their
wants, needs, and expectations as customers. In a traditional healthcare environ-
ment that caters primarily to physicians needs, many clinicians offer minimal
medical consultations with patients and their families. Such treatments lead to
increasingly unhappy and vocal patients who express their unhappiness by ling
lawsuits and by seeking service alternatives.
Healthcare managers are expanding their aim, providing patients with ser-
vice that ensures not only positive clinical outcomes but also positive total
healthcare experiences (Ford, Bach, and Fottler 1997; Fottler et al. 2000). In
the current healthcare marketplace, customer service is the new competitive
advantage.
The Voice of Patients
A survey commissioned by the Voluntary Hospitals of America in the 1990s re-
ported that public trust in healthcare institutions markedly declined, with health
plans losing more ground than physicians or hospitals (Alliance 1998). This decline
in trust was especially pronounced among survey respondents aged 4059; those
with higher income and education levels; and those who had recently changed,
added, or selected a physician or hospital. These respondents gave hospitals only a
67 percent satisfaction rating. Among 31 other industries, hospitals ranked 27th,
which placed them just above the Internal Revenue Service and only 10 percentage
points below the tobacco industry.
More recently, fndings from a survey by the National Coalition on Health
Care (2008) indicate a lack of consumer confdence in the quality, cost, and acces-
sibility of healthcare services and in the U.S. healthcare system as a whole. Eight
out of ten survey respondents believed that something is seriously wrong with the
healthcare system, and six out of ten were not optimistic about its sustainability
in the future. Also, seven out of ten respondents agreed that healthcare quality is
often compromised to save money, while eight out of ten stated that high-quality
services are not affordable for the average person. In general, respondents who were
65 or older were more satised with quality and coverage than those who were in
their 30s and 40s.
These results are not surprising. Services paid for by private or government in-
surance are not as likely to fulfll patients preferences for convenience and personal
control as those services that are paid for by the consumers.
6 Achieving Service Excellence
The National Partnership for Women and Families (1998) undertook a re-
search project to examine womens mind-sets regarding health and healthcare in
the United States. DYG, Inc., a social and market research company, conducted six
focus groups for the project. Focus group members (composed entirely of women)
perceived the following aws of the U.S. healthcare system:
1. It promotes an emphasis on money rather than care.
2. The greed of insurance companies and providers represents a real threat to quality.
3. Costs to consumers are high and rising.
4. Average people are treated poorly by uncommunicative and arrogant
healthcare providers and insurers.
5. Access is often constrained or denied, even for those with employer-provided
insurance coverage.
According to most focus group participants, the healthcare process increases
their stress levels because it is insensitive to patients time, ineffcient, and need-
lessly complex. For example, requiring a female patient to obtain a referral from a
primary care physician before she can see a gynecologist is unnecessary, is offensive,
shows a lack of respect, and wastes her time. In response to such conditions, female
healthcare consumers have demanded improvements to or have become activists
for womens healthcare (National Partnership for Women and Families 1998).
Although this study is more than a decade old, its conclusions are still relevant
today. Americans value personal control in all areas of life, including healthcare. This
value is evident among members of the focus groups, who reported that they had
confronted the individual healthcare system, provider, or insurance plan to person-
ally resolve their healthcare concerns. These women, and other patients like them,
demand one critical aspect of the rise of customer-driven healthcare: respect.
PATI ENT NEEDS, WANTS, AND EXPECTATI ONS
The unique and multilayered players (e.g., third-party payers, physicians, regu-
latory agencies) in the healthcare industry have caused healthcare organizations
to pay less attention to their primary customersthe patients. However, vari-
ous trends in the healthcare environment, along with the hypercompetitiveness
of the market, have motivated healthcare organizations to be more responsive
to this customer group. Although the organization must continue to main-
tain good partnerships with physicians and third-party payers, it has to forge
Chapter 1: Customer Satisfaction as Competitive Advantage 7
relationships with patients as well. When the patient has healthcare choices,
competing at a reasonable price is no longer enough. The organization must
convince the patient that it is also the most capable of delivering a satisfying
total healthcare experience.
For the organization, identifying and then meeting the needs, wants, and expec-
tations of patientsregarding participation and control, convenient access, cultural
competence, caring interaction, and information and valuecan make the differ-
ence between success and failure in the future. Todays consumers demand and have
grown accustomed to getting a lot of respect from the businesses they patronize.
Healthcare organizations must meet all of these expectations to become their pa-
tients frst choice. Healthcare executives, therefore, must spend more time and energy
on being responsive to customers, providing excellent service, and marketing their in-
stitutions strengths.
Participation and Control
Todays healthcare consumers use the Internet, among other sources, to fnd in-
formation on a wide range of healthcare issuesfrom a providers quality data to
treatment and medication alternatives to clinical protocols and innovations. Con-
sequently, these patients are more empowered and get involved in decisions about
how their dollars are spent (Green and Himmelstein 1998; Orlando Sentinel 2001).
Vocal consumer groups also encourage healthcare consumers to change their atti-
tudes about healthcare, which transforms them from patients to active participants.
Regina Herzlinger (1997) characterized healthcare consumers as well-informed,
overworked, and overburdened with child and eldercare responsibilities, whose
demands for convenience and control have caused many American businesses to
greatly enhance their quality and control their costs.
Convenient Access
A study by PricewaterhouseCooperss Health Research Institute (2007) revealed
that patients want healthcare facilities that are geographically nearby, are open long
hours, and have a process that ensures short doctor visits. When asked what fac-
tors they considered in deciding where to go for nonurgent care, 90 percent of
survey respondents said proximity, which rated higher than prior experience
and slightly lower than condence in the quality of medical staff. Following are
the main lessons from this study (Lutz 2008):
8 Achieving Service Excellence
Retail clinics will prompt payers to rethink primary care. Because healthcare
consumers want convenient access, they expect healthcare providers to
function like stores, banks, and hotels.
The public holds the healthcare industry to a higher standard than it reserves
for other service industries. As a result, healthcare needs more regulation and
more social responsibility. Consumers are not afraid to contact the elected
government representatives in their areas to right perceived wrongs.
Not only do consumers want to obtain healthcare services close to their
homes, they also want to be able to conduct business transactions online,
to customize services according to their own needs, and to not be treated as
merely a number.
Survey respondents believe that healthcare executives have been less involved
and provided less leadership (than advocacy groups, physicians and nurses,
and individual citizens) in improving the healthcare system.
Cultural Competence
Customizing healthcare services is a consumer desire that is at odds with the stan-
dardization goal of regulatory agencies and third-party payers, among others. These
groups view standardized care as more cost effective, more efcient, and safer than
customized services. Customization, however, enhances customer satisfaction.
One positive aspect of customization that has been documented in the literature
is culturally competent care deliverythat is, healthcare that is responsive and sen-
sitive to the unique needs of ethnically and culturally diverse patients. Educational
institutions that prepare students (including administrators, physicians, and other
caregivers) in the healthcare eld are urged to offer cultural competence training
or courses that help these future professionals understand and better communicate
with various diverse patients and other customers. Research indicates that clinical
and customer satisfaction of ethnically/culturally diverse patients tends to improve
when clinicians have received training in cultural competence (Beach et al. 2005;
Romana 2006).
Caring Interaction
Caring interaction can enhance customer satisfaction and loyalty. According to one
study, three attributes have the most impact on patient satisfaction in primary care prac-
tices: physician care, staff care, and access, in this order (Otani, Kurz, and Harris 2005).
Under the physician care attribute, a major contributor to satisfaction is the length of
Chapter 1: Customer Satisfaction as Competitive Advantage 9
time a clinician spends with the patient. Under staff care, the most desirable traits are
willingness to listen, compassionate behavior, and prompt service. Under access, survey
respondents cited caring interaction with appointment personnel as a satiser.
Findings of this study present several lessons for healthcare organizations: phy-
sicians should allocate time for patient questions or concerns about their medical
conditions; nursing and ancillary staff should recognize the anxiety felt by patients
and their families and interact with them in a sensitive manner; waiting times for
all processes should be reduced; and support personnel should efciently manage
the process for scheduling appointments.
Information and Value
A patient chooses a provider on the basis of published outcomes and word-of-
mouth information. After a provider is selected and the service/procedure is re-
ceived, the patient then determines the value and quality of the healthcare experi-
ence on the basis of multiple factors. The patients holistic perception begins before
admission and ends after discharge and bill payment, and the provider must deliver
an excellent clinical and customer service experience throughout. Each component
of this experience contributes to the value perceived by the patient.
To sustain the relationship, the organization must continually remind the pa-
tient, through various communication means, that it is a high-quality provider that
can meet and exceed his needs, wants, and expectations.
CUSTOMER SATISFACTION LEADS TO CUSTOMER LOYALTY
Why should healthcare executives and health administration students be concerned
whether patients are satised or dissatised with their total healthcare experience?
The answer is simple: Customer satisfaction leads to a variety of positive outcomes;
conversely, dissatisfaction results in negative consequences.
High levels (extremely and highly satised ratings) of customer satisfaction in-
crease market share, improve fnancial outcomes, enhance the publics perception
of the institution and its leaders, encourage former patients to return to the facility
when needed, and bolster recommendations by patients to friends or family to use
the services offered at the facility. Conversely, low levels of customer satisfaction
undermine the long-term viability of the organization.
Customer satisfaction is a short-term product of one excellent encounter,
while customer loyalty is a long-term outcome of an ongoing satisfying experience
(OMalley 2004a). Customer loyalty is dependent on the consistent delivery of
10 Achieving Service Excellence
a memorable service experience that leaves the patient with a constant favorable
impression of the provider. Loyal customers generate word-of-mouth advertising,
avoid litigation, refer the organization to friends and family, make nancial dona-
tions, and volunteer their time and talents. Also, as patients, they are more likely
to follow the prescribed treatment regimen and thus achieve the desired medical
outcomes.
In an environment of cost containment, satisfying customers and building cus-
tomer loyalty make sense because doing so generates revenue, reduces expense, and
saves time (Dube 2003; OMalley 2004a).
True Customer Loyalty
Smith (2009) notes that loyalty is a misused term. Most organizations think that
loyalty is about customers being devoted to patronizing their business, but it
should be the other way around. The organization should show its loyalty to repeat
customers by offering an added valuethat is, a service or product not generally
experienced in the mass market.
True loyalty happens when a customer experiences an emotional engagement
with the organization or product. This engagement comes from experiencing the
brand or organization in a unique way that creates value for the customer. This
emotional engagement matters because companies that successfully created both
functional and emotional bonding had higher customer retention ratios and higher
ratios of cross-selling and up-selling than those that did not. True loyalty re-
quires you to know who your most protable customers are and to consistently
deliver an outstanding customer experience so as to create a high degree of trust
in your brand. These loyal and highly protable customers are then prepared to
recommend your organization to others (Smith 2009).
True loyalty is a long-term commitment that depends on the organizations abil-
ity to consistently deliver a memorable customer experience that leaves customers
with an ongoing favorable image, feeling, and union with the provider. A memo-
rable customer experience is not a single event, but includes many differentiating
service encounters that are delivered over a wide spectrum of employeecustomer
encounters. These customer experiences are more than the sum of the individual
service encounter parts (OMalley 2004a).
Loyal customers generate positive word-of-mouth advertising; are less likely
to sue; and are more apt to volunteer, refer others, and donate time and money.
Greater customer loyalty also encourages greater customer cooperation, which may
Chapter 1: Customer Satisfaction as Competitive Advantage 11
lead to better clinical outcomes because the customers conform to treatment plans
and may be more likely to purchase other service offerings. Thus, loyal customers
may enable the organization to achieve greater revenue growth. They also reduce
costs for the provider because they do not require an investment in marketing and
do not bring lawsuits. Unfortunately, most healthcare organizations do not have a
customer loyalty program in place.
Any deviation from total satisfaction erodes loyalty. Customers who are not
totally satised tend to change providers after they complete a particular course
of treatment. Reducing such defections by 10 percent to 15 percent can double
prots. Similar benets could also accrue to healthcare organizations that work to
bring out their customers true loyalty.
In many healthcare organizations, however, customer service is given lip service
and not the resources for selecting, training, and rewarding employees who pos-
sess or can develop customer-service skills (Mayer et al. 1998). This is particularly
true in an economy that is in recession, where consequent nancial pressures cause
healthcare executives to cut stafng and staff support in ways that may negatively
affect customer service.
MARKET TRENDS
Gaining a competitive advantage in todays healthcare environment is increasingly
diffcult, so examining todays trends is important. A healthcare organization will
sustain a competitive advantage only so long as the attributes of the service it deliv-
ers correspond to the key buying criteria of a substantial number of customers in its
target market. Sustained competitive advantage is the direct result of the value dif-
ferentiala marked difference in clinical quality, service quality, or price between
two competing servicesthat customers believe one organization has over another.
Benchmark healthcare organizations know that the quality and value of their ser-
vices are largely, if not entirely, determined in the mind of the customer.
One way to achieve a competitive advantage is to develop capabilities that are
difcult for competitors to duplicate in the short run or, even better, in the long
run. Such capabilities enable the organization to deploy competencies and tangible
and intangible resources that produce desired services. Implementing appropriate
principles and practices that have been proven effective by the best service organi-
zations strengthens organizational capabilities.
Five major market trends affect healthcare organizations. Each of these trends
is discussed in this section.
12 Achieving Service Excellence
Trend 1: Awareness of Customer Expectations
Exhibit 1.1 lists eight major customers of healthcare organizations, their customer type
(i.e., primary or secondary, external or internal), and their service expectations beyond
clinical excellence. As the exhibit shows, the expectations of these eight customers over-
lap. Although the patient is the primary customer, secondary customers (e.g., families,
vendors, physicians) are not unimportant. As mentioned earlier, the organization has to
maintain good relationships with its internal and external stakeholders, including the
medical staff and unafliated community physicians.
Understanding the expectations and key drivers of all customers helps the or-
ganization formulate the strategies, stafng, and processes necessary to deliver an
excellent total healthcare experience. Because the patient is the principal customer
and the ultimate reason that the organization exists, benchmark healthcare organi-
zations focus their attention on the patients needs, wants, and expectations. Cer-
tainly, the service principles and practices applied to patients also work to satisfy
other customer groups.
Trend 2: Quality Improvement from the Patients Perspective
In the past, efforts to improve the quality of healthcare have centered on the pro-
viders needs rather than those of the patient. For example, in 1991 The Joint
Commission (formerly the Joint Commission on Accreditation of Healthcare Or-
ganizations) made the adoption of continuous quality improvement (CQI) meth-
ods a criterion for accreditation. The Joint Commission proposed that healthcare
organizations set expectations, develop plans, and implement procedures to assess
and improve their governance, management, clinical services, and support services.
The goal here was to improve organizational structures and processes (The Joint
Commission 1991). Although worthy, this CQI pursuit had mixed results at best
(Bigelow and Arndt 1995). Further, the proposals were aimed at improving care-
giving from the viewpoint of providers, not patients. Specically, the recommenda-
tions did not require obtaining consumer input or benchmarking against the best
practices of service organizations outside of healthcare.
Today, healthcare organizations can use ORYX in their quality pursuit. In 1997,
The Joint Commission introduced ORYX, a system hospitals can use to gather and
report their performance data. ORYX provides a list of the core and noncore mea-
sures that should be collected and submitted to The Joint Commission as part of
the hospital accreditation process.
Following are clinical measure sets that may be selected by hospitals (The Joint
Commission 2008):
Chapter 1: Customer Satisfaction as Competitive Advantage 13
Acute myocardial infarction
Heart failure
Pneumonia
Pregnancy and related conditions
Hospital-based inpatient psychiatric services
Childrens asthma care
Surgical care improvement project
Hospital outpatient measures
Reporting and collection of measurement data must follow the framework of a
Joint Commissionendorsed system.
The report card movement embodies an attempt by the healthcare industry to
improve quality and present information that helps consumers make better deci-
sions about health plans and providers. The Healthcare Effectiveness Data and
Exhibit 1.1 Customers of Healthcare Organizations, by Type and Service Expectations
Customer Customer Type
Service Expectations Beyond
Clinical Excellence
1. Patients External/primary Personalized care, prompt attention,
professionalism, communication,
respect, privacy, and clear information
2. Families External/secondary Professionalism, communication,
respect, privacy, and clear information
3. Visitors External/secondary Professionalism, respect, and clear
information
4. Third-party payers External/secondary Prompt attention, professionalism,
privacy, and clear information
5. Vendors External/secondary Prompt attention, professionalism, and
clear communication
6. Clergy Internal or external/secondary Professionalism, communication,
privacy, and clear information
7. Physicians Internal or external/secondary Respect, conict resolution, teamwork,
communication, privacy, and clear
information
8. Staff Internal/secondary Professionalism, confict resolution,
communication, respect, privacy,
teamwork, and clear information
14 Achieving Service Excellence
Information Set (HEDIS), developed by the National Committee for Quality As-
surance (NCQA), is a performance measurement system designed specifcally for
health plans. Using HEDIS, health plans can measure and compare their own
performance on numerous health metrics, including management of high blood
pressure and smoking cessation, against the performance of other insurers. HEDIS
measures are updated annually (NCQA 2009).
Consumer Reports (1996) noted that HEDIS data on health plans were uncorre-
lated with its own surveys of patient satisfaction. Some dimensions of the customer
experience were generally ignored in providers measures of quality, including pa-
tient comfort, convenience, satisfaction, and service quality. Increasingly, however,
data requirementsby The Joint Commission and NCQA, for exampleare be-
ginning to incorporate select measures of consumer satisfaction.
Today, one of the most consumer oriented of all the available measurement sys-
tems is the CAHPS (Consumer Assessment of Healthcare Providers and Systems),
developed by the Agency for Healthcare Research and Quality. CAHPS creates and
makes available surveys for healthcare customers. Because they are customer centered,
the surveys include items and questions that address all aspects of the healthcare ex-
perience, including staff s interpersonal and customer service skills. Patients, families,
potential customers, providers, and health plans are among those who read the survey
results to guide their decision making on buying, switching, dropping, or keeping
services. The outcomes are also used in quality improvement efforts (CAHPS 2009).
Because the customer perspective is now represented in report cards and other
performance measurement instruments, more healthcare organizations are rede-
signing their systems to better respond to patients. Here are several ways that clini-
cal and customer service data are collected and distributed within the industry:
Hospital Compare is a website (see www.hospitalcompare.hhs.gov) that
contains information on how hospitals provide care to patients who suffer
from medical conditions such as heart disease and diabetes. The website also
includes patient ratings of attributes such as cleanliness of the hospital room
and bathroom and the customers intention to recommend the hospital to
others (Geggis 2008). The goal of Hospital Compare is to make healthcare
practices more transparent and to aid consumers in making informed
decisions. Thus far, it is unclear whether the information on Hospital
Compare sways consumers to shift their healthcare spending toward hospitals
that exhibit the highest quality ratings.
Consumers Union, a consumer advocacy group and the publisher of
Consumer Reports, launched a hospital ratings service, adding to the growing
providers of consumer information on the Internet (Mathews 2008). On its
Chapter 1: Customer Satisfaction as Competitive Advantage 15
website (see www.consumersunion.org), Consumers Union offers assessments
of health insurance plans, drugs, and some medical treatments.
Athenahealth, Inc. (see www.athenahealth.com) is a Web-based medical
practice management company that ranks health insurers on the basis of
clients assessments of the insurers level of responsiveness. Among the
attributes these clients evaluate are delays in payment and dropped insurance
plans, both of which reduce plan members access to care.
The American Customer Satisfaction Index (ACSI), an indicator created
by the University of Michigans Ross School of Business, tracks customer
satisfaction scores in various industries. In 2008, ACSI reported that hospitals
ranked 28th among 45 other service industries, while health insurance was
ranked 36th out of 45. In 2006, ACSI found that health insurers ranked near
the bottom in consumer satisfaction, just above airlines and wireless phone
providers (Hindo 2006). A major factor in consumer dissatisfaction is cost
cuttingthat is, companies minimize their overhead by eliminating services,
products, or extras that consumers have grown to expect.
J.D. Power and Associates conducted a customer satisfaction study for Business
Week. Although this study included only companies with at least $1.5 billion
in annual revenue (hence excluding any healthcare organization), its ndings
have implications in the healthcare industry. The top 25 companies (including
Marriott, Publix, UPS, Lexus, and USAA) exceeded customers expectations
through a variety of means. They took advantage of technological innovations,
provided employee training and incentives, centered their corporate strategies
on customer service, regularly evaluated their service performance, selected
employees on the basis of their service orientation, and offered concierge
services and customer guarantees. Most of these successful companies involve
their top executives in customer service initiatives, and a few of them even
developed a chief customer offcer position (McGregor 2007).
Trend 3: Formal and Informal Reporting of Performance Results
In the United States, the performance data of healthcare organizations and provid-
ers are widely and easily accessible. National magazines, such as U.S. News & World
Report, publish an annual list of best hospitals, while local news outlets (print,
television, and Internet) occasionally feature the best-rated providers in the com-
munity. For example, each year Pittsburgh Magazine and New York Magazine run a
list of their respective regions best physicians and hospitals. In addition, statistics
and studies on physician malpractice or nursing home performance can be searched
16 Achieving Service Excellence
on the Internet with a few keywords. Every 915 months, the Massachusetts De-
partment of Public Health inspects the quality and compliance with standards of
all nursing care facilities across the state. The inspections are not scheduled, and
the results are publicized (MassLongTermCare.org 2009). Publicizing performance
data and ratings emphasizes the impact of consumers on the organizations overall
outcomes and thus the importance of treating customers well.
More and more consumers opt out of company-prescribed channels, such
as call centers, to voice their grievances. Instead, they turn to technology to
share and spread their opinions (McGregor 2008). Consumer blogs, some of
which contain persuasive videos, detail the customers transactions and even-
tual disappointment with a product, service, or provider. After getting no help
or satisfying response from customer service representatives and supervisors,
some consumers send out e-mail carpet bombs to the companys executives
or top-level personnel. Here, the idea is not only to reach a full resolution to
the problem but also to call attention to the inadequacies of the companys
customer service function.
Dissatised customers are willing to express their dissatisfaction to a worldwide
audiencethat is, it does not take long for one disgruntled person to spread the
word to his or her contacts on a social networking site, such as Facebook.
Trend 4: Consumer-Driven Movement
Historically, in the United States, healthcare services have been provided on a
wholesale basis. The government, employers, and insurance companies have been
the primary purchasers of these services, leaving the direct consumer (the patient)
out of the pricing and purchasing decisions. Often, doctors have dictated what ser-
vices are needed and where and how these services should be delivered. Today, con-
sumers are taking control of their own healthcare for several reasons, including new
tax laws, high insurance deductibles and copayments, health savings accounts, the
wide availability of medical information, and the emergence of retail health clinics
(see Malvey and Fottler 2006; Hanaman 2006) and other outpatient centers.
Giving employees the responsibility for managing their own healthcare ben-
efts (just as they do their retirement savings) adds momentum to the patient-
involvement movement in healthcare. Many employers have created websites to
help employees make health-beneft decisions and sign up for plans. Entrepre-
neurs, in turn, offer online services that greatly reduce the need for employers to
manage this type of employee information. Such online services offer employees
tools and information that facilitate health-related decision making.
Chapter 1: Customer Satisfaction as Competitive Advantage 17
Dysfunctional insurance-related incentives prevent healthcare organizations
from developing entrepreneurial consumer-oriented services. The solution to the
lack of healthcare entrepreneurship, according to some healthcare insiders, may
be consumer participation (Cannon and Tanner 2005; Porter and Teisberg 2006;
Kapp 2007). The assumption with such websites is that individual consumers
(rather than health plans) are best able to allocate their own resources and determine
their own healthcare needs. One experimental model entails a high-deductible health
insurance policy, a health savings account, and gap coverage. Under this model, the
individual consumer is empoweredthat is, he or she exercises a high degree of
personal choice, direction, and control regarding healthcare (Cannon and Tanner
2005; Porter and Teisberg 2006; Kapp 2007).
Corporations are self-insuring in increasing numbers. This means that health-
care services are increasingly paid for and managed by employers rather than by
insurance companies. One signifcant advantage of self-insurance is that the health
plans offered to employees are more exible and allow employees to have a voice in
how these plans work and what they provide.
Trend 5: Globalization of Healthcare
Employers, insurance companies, and patients have discovered that in some other
countries the costs of some healthcare services are lower and their quality and
outcomes comparable to those achieved in the United States. The result is medi-
cal tourismthe practice of U.S. patients traveling outside the country to obtain
surgical services (Connell 2006). Medical tourism has grown rapidly in the last de-
cade because of high healthcare costs, long waits for some surgical procedures, new
technology and skills in destination countries, lower transportation fares, Internet
marketing of such services, and the globalization of the world economy.
Countries in Southeast Asia, particularly India, have been the primary destina-
tions of medical tourists. In many of these foreign-run facilities, language barriers
are not an issue and the standards of care are similar to those followed in the United
States. In some instances, U.S. patients achieve equal clinical outcomes and receive
higher service quality, although follow-up care may be diffcult to maintain.
International migration of healthcare professionals is a major part of global-
ization and can present challenges for U.S. healthcare executives. Foreign-born/
trained physicians and nurses need support in multiple areas, such as visa appli-
cations, healthcare system training, acculturation and adaptation, credentialing
and continuing education, and interpersonal relations (Masselink 2008). Health-
care organizations that recruit foreign professionals must be aware of the ethical
18 Achieving Service Excellence
implications on these workers native countriesthat is, by hiring these people to
practice in the United States, are U.S. employers depriving the native countries of
healthcare knowledge and resources?
LESSONS FROM BENCHMARK
SERVI CE ORGANI ZATI ONS
The modern economy is dominated by service organizations. According to Rust
(1998), even businesses that deal primarily in physical goods view themselves
primarily as services, with the offered good being an important part of the service
(rather than the service being an augmentation of the physical good). These busi-
nesses have adopted traditional service terms such as customer satisfaction, cus-
tomer retention, and customer relationships.
Throughout this book, we present lessons learned from benchmark health-
care and service organizations to show how todays healthcare organizations
can use their strategy, staff, and systems to provide each patient with a seam-
less healthcare experience. To do so, healthcare organizations must pay close
attention to the three components of the total healthcare experienceservice
product, service setting, and service delivery system. Providing the standards in
each component alone will meet the patients basic expectations, but excellence
in all components will make a patient say or think, They did their best for me.
What a superb healthcare experience!
The principles of managing the total healthcare experience are the same for all
organizations, from a neighborhood clinic to a national managed care organization
to a rural community hospital to an urban academic medical center. These prin-
ciples stress service in a way not often done by academic programs and healthcare
management seminars. That is, in this book, we argue that excellent practices in
other service industries, such as airlines, amusement parks, and hotels, are equally
applicable to healthcare enterprises. The most successful healthcare organizations
treat their customers like guests and offer not only positive clinical outcomes but
also superb total healthcare experiences.
Most organizations that treat customers like guests and provide memorable
experiences do not come from the healthcare industry. This is why many of the
examples in this book are about other felds. For example, The Walt Disney Com-
pany, which refers to its customers as guests, is considered one of the best at
service excellence. It was the rst to think in terms of delivering experiences rather
than goods or services. As such, Disney is a worthwhile customer service model for
any organization, in and out of healthcare.
Chapter 1: Customer Satisfaction as Competitive Advantage 19
Ford and Bowen (2008) point out that other service businesses have the follow-
ing customer service fundamentals:
Producing a memorable customer service experience is the ultimate goal.
The customer coproduces or cocreates the value of the experience.
Employee and customer attitudes and relationships are key to customer
satisfaction.
All tangible (visible to the customer) aspects of the service are managed.
The customer determines how organizational effectiveness is measured.
Culture is viewed as a mechanism for control and inspiration.
Service errors are sought and fxed.
Judging by these fundamentals, the healthcare industry indeed has much to
learn from benchmark organizations in other service elds. The improvements that
result will carry over to the bottom line, a welcome change in these nancially
uncertain times.
THE CHALLENGES OF PROVI DI NG
SERVI CE EXCELLENCE I N HEALTHCARE
Healthcare executives face multiple challenges to their efforts to provide superb
customer service.
First, primary care physicians are in short supply in the United States. Unlike in
other countries, this country values its specialists more than its primary care physi-
cians (Pho 2008). As a result, the odds are stacked against primary care, causing
a disincentive for these physicians. Primary care demands too much work for too
little pay. Insurance companies dictate the price for each service, and telephone
and e-mail communications between doctors and patients are not reimbursed. The
only way for primary care physicians to raise their income is to see more patients,
which is antithetical to service excellence. Because of the shortage of primary care
physicians, U.S. patients have to wait longer for appointments than do patients
in other countries (Arnst 2007). This is one reason for the rapid rise of retail and
other walk-in clinics (Malvey and Fottler 2006).
Second, healthcares unique reimbursement system acts as a barrier to great
customer service. In manufacturing, for example, the customer receives a product
or service and then pays the producer or distributor directly. In contrast, in health-
care, the parties that pay for the product or servicesuch as a managed care com-
20 Achieving Service Excellence
pany, Medicare, or Medicaidare not always the ones who receive that product
or service. These third-party payers impose rules, regulations, guidelines, clinical
protocols, and incentives on providers that constrain the services provided to the
patients. If the provider fails to comply with these requirements, the third-party
payer may deny reimbursement for the services already provided. Although being
customer focused is important from a strategic and competitive perspective, it has
to ft within the political and economic framework set by the third-party payers, a
constraint that most other service industries do not have to grapple with.
Third, healthcare does not hand out monetary rewards for excellence nor pen-
alties for mediocrity (Goodman 2007). Service excellence, then, tends to be the
result of the energy and enthusiasm of a few individuals who receive (or expect)
no nancial bonus for their efforts. The reason for this is that health insurance
reimburses for the number (volume) of procedures performed, not the clinical or
service quality. Under this reasoning, hospitals and doctors can make more money
providing inefcient, mediocre care to many patients. Healthcare settings in which
third-party payment is rare or nonexistent (e.g., walk-in clinics or laser surgery) are
vibrant, entrepreneurial, innovative, and competitive. Herzlinger (2007a) makes a
similar point when she decries the lack of innovation in healthcare and ties it to the
inexible regulatory and reimbursement system.
Only recently have healthcare researchers and management scholars begun
to consider the management of the total healthcare experience as part of the
healthcare managers responsibility. Therefore, much of what is known in this
area is based on anecdotal information and case study examples, which makes
perfect sense. In the early stages of inquiry into any eld of business, the logi-
cal approach is to nd the best organizations and study them to discover the
principles that drive what they do. A review of the service management litera-
ture quickly reveals several benchmark organizations; these include Southwest
Airlines, Marriott, Ritz-Carlton, Nordstrom, USAA Insurance Company, and
The Walt Disney Company.
Some healthcare organizations, such as Shouldice Hospital, SSM Health Care,
Sharp HealthCare, and Baptist Health Care, have learned the importance of un-
derstanding what their customers expect from all parts of their service experience,
and they manage their businesses to enable them to exceed expectations. Because
they have studied their customers long and hard, they know what their customers
want, what they are willing to pay for it, and how to give it to them. Outstanding
healthcare organizations meet customer expectations at a minimum and then go
beyond them. As a result, customers, clients, patrons, and patients return, again
and again.
Chapter 1: Customer Satisfaction as Competitive Advantage 21
THREE FUNDAMENTAL CONCEPTS
Three fundamental concepts of service excellence underlie the service principle
and service strategies in each chapter:
1. Focus on the customer.
2. Treat the customer like a guest.
3. Manage the total healthcare experience.
Focus on the Customer
Everything the healthcare organization does should revolve around the customer
usually the patient. Too many healthcare managers think rst about reimbursement
procedures, clinical standards, and physician needs. Most major processessuch
as designing a service product, creating the climate in which the patient interacts
with the organization, and setting up the service delivery systemstart with execu-
tives, third-party payers, or physicians. This is management from the inside out.
Focusing on the customer, however, requires managing from the outside in.
Start with the customers. Study them endlessly to nd out what they need, want,
value, and expect and what they actually do. Then, focus everyone in the organiza-
tion on doing a better job of meeting and exceeding their expectations in a way
that allows the organization to achieve its nancial goals.
Another way of pursuing customer focus in healthcare is to think retail or
follow the retail model. This means taking on the perspective of the consumer
when developing service features and attributes; this effort, in turn, will prompt
the consumer to buy from your organization (Goldman and Corrigan 1998).
Retailers employ three basic strategies to maximize customer satisfaction and create
customer loyalty:
1. Enhance the customer experience.
2. Capture a greater share of the consumers spending for related needs.
3. Create new sources of revenue by discovering unmet or unacknowledged needs.
The recent growth of independent primary care practices that do not accept
health insurance exemplies the value of practicing the principles of customer
focus. Known as concierge medicine, these facilities only accept a limited number
of patients, provide quick appointments, and dedicate an above-average amount
22 Achieving Service Excellence
of time to each patient. Such facilities are growing fastest in afuent cities and
suburbs (Beck 2009) where the average consumer can afford boutique services.
These doctors lobby Congress to create more fnancial incentives for employers to
offer workers medical savings accounts, which let people put aside pretax earnings
for healthcare expenses. Proponents of medical savings accounts argue that people
who allocate money specically for healthcare purposes will spend the funds on
independent doctors who provide excellent customer service.
Successful healthcare organizations are those managed by leadership teams who
are committed to customer service and instill a service philosophy in their cultures
(Girard-DiCarlo 1999; Studer 2008). These leaders continually enhance their core
competencies and set and sustain standards that enable their organizations to sat-
isfy the needs of customers at all times in all service locations. They know that each
interaction with a customer or potential customer represents a moment of truth
that needs to be endowed with caring and courtesy.
In a consolidated health system, the service excellence philosophy must be fol-
lowed by all leaders at all facilities so that the customer service focus prevails across
the organization (Girard-DiCarlo 1999; Studer 2008). This philosophy must be
embraced by the systems outsourcing partners as well to ensure that high-quality
customer service is provided consistently.
As the Baldrige Award winners have shown, focusing on the customer is an on-
going effort. It should begin with selecting customer-oriented employees and pro-
viding service training and should continue on to measuring results and rewarding
employees for customer service accomplishments.
Treat the Customer Like a Guest
In the last decade, healthcare has undergone a positive paradigm shift. Increasingly,
patients are treated as guests, healing (which addresses the whole body) is prefer-
able to curing (which focuses only on the illness), and patients are viewed as active
participants or collaborators. Willis (2000) has argued that this paradigm shift is a
return to the original purpose of hospitals: to provide hospitable accommodation
to strangers. Today, healthcare has become a business; the treatment of a particu-
lar disease, a product line; and the hospital, a cost center. As mentioned earlier,
consumer surveys suggest that many healthcare facilities do not provide the little
things that make patients feel like honored guests.
Implementing the concept of treating the customer (especially the patient, as
the primary customer) as a guest requires a change of attitude, not merely a switch
in terminology from customer to guest. Many outstanding service companies
Chapter 1: Customer Satisfaction as Competitive Advantage 23
constantly remind their employees to think of their customers as guests. Disney
even coined the term guestologythe scientific study of guest behavior
to better understand the needs, wants, and expectations of its customers.
As discussed earlier, in this book, we generally refer to healthcare consumers as
patients and customers, but regardless of the terminology used, our message is
the same: Healthcare organizations must instill the mind-set among their staff that
customers are guests.
This mind-set changes the way the organization (through its employees) per-
forms its responsibilities. For example, if a patient comes to the emergency de-
partment with a broken arm, the organization is obligated to have the following
available: the physician and other support staff, bed or space, and equipment and
supplies. If the organization appropriately meets the basic requirements for at-
tending to and setting the broken arm, then the patient leaves satised with the
service.
With a guest mind-set, however, the organization does more than what it is
obligated to deliver. It adds extra touches throughout the entire care experience,
such as acknowledging and apologizing for the long wait; giving status updates;
or offering water, coffee, or reading material. As a result, the patient goes home
impressed with how he or she was respected and treated as a customer. Feeling like
a guest is a welcome change for healthcare customers. It is pleasantly unexpected
and thus exceeds the expectations of the typical healthcare experience. Moreover,
it encourages patients to return and refer others to the facility. Repeat business and
referrals are critical to the organizations long-term viability and proftability.
Apply this concept to your own experiences as a customer. Will you patronize
a business again if it made you feel central to its operation rather than merely a
component of a commercial transaction? Your patients and other customers think
the same way.
Manage the Total Healthcare Experience
In healthcare, the primary goal is to achieve a positive clinical outcome. The rest
of the patient experience, however, often receives much less attention, to the det-
riment of all concerned. Managing the total healthcare experience means ensur-
ing that every component of carethe physical environment, organizational cul-
ture, clinician and staff behavior, interpersonal relations, communication system,
administrative policies, clinical protocols, and standards of operation, to name a
fewis efcient, consistent, and responsive to the needs, wants, and expectations
of all customers, especially patients.
24 Achieving Service Excellence
In the current experience economy, a term coined by Pine and Gilmore
(1998), well-rendered clinical care may no longer be enough. Todays patients are
seeking more from their healthcare providers, and they expect it each time they
come for any service. In Chapter 2, we discuss the three parts of the total healthcare
experience: service product, service setting, and service delivery system. We also
show how benchmark healthcare and service organizations use their strategy, staff,
and systems to provide each patient (viewed as a guest) with an excellent service
experience.
CONCLUSI ON
Focusing on the customer, treating customers like guests, and managing the total
healthcare experience seem to be simple concepts. In reality, however, they are huge
managerial challenges on which innovators in healthcare spend considerable time
and energy. Healthcare organizations that follow these concepts not only raise the
bar but also take business away from competitors that have only a vague under-
standing of these principles.
Service Strategies
1. Identify the needs, wants, and expectations of your healthcare customers
(both primary and secondary).
2. Create a plan to overcome and reverse negative customer perceptions about
healthcare delivery systems in general and your healthcare organization in
particular.
3. Ensure that your organizations website provides links to healthcare
resources and related information.
4. Research what the best healthcare and other service organizations are doing
to serve their customers, and then adopt those techniques that make sense
in your environment. In other words, benchmark against the best.
5. Think retail when developing product/service features and attributes to
convince the customer to buy from your organization.
6. Implement the three fundamental concepts of customer service: (a) focus
on the customer, (b) treat the customer like a guest, and (c) manage the
total healthcare experience.
25
Hail guest! We ask not what thou art: If friend, we greet thee,
hand and heart; if stranger, such no longer be. . . .
Arthur Guiterman
C H A P T E R 2
The Customer as Guest
Service Principle:
Meet or exceed the quality and value that customers expect
Serving patients and making products are so dissimilar that each requires dif-
ferent management principles and concepts. Catching a defective tire or a paint
blemish at the nal inspection stage is one thing; it is quite another to listen to an
irate patient complain that the hospital, clinic, group practice, or managed care
company failed to live up to its promise of quality and value. In the rst instance,
the quality inspectorone of many intermediaries between the maker of the prod-
uct and the nal customercan send the defect back so that the customer never
sees the faulty product. In the second situation, the poor service has been delivered,
and the quality inspector is the customer. The administrator or manager can only
apologize for the failure, offer options to x it, and assure the patient that such an
unsatisfactory experience will be evaluated.
The challenge for healthcare organizations is that patients want and expect not
only outstanding clinical interventions but also excellent customer serviceevery
single time. Compounding this challenge is that service quality and value are
judged not only by administrators, third-party payers, and governmental oversight
agencies but also by patients and their family and friends. Consumer Reports occa-
sionally reviews managed care plans and U.S. News & World Report annually rates
hospitals, but patients evaluate their healthcare experience each time.
Therefore, on any given day, a patient (who may have been happy with a previ-
ous experience) could deem a given service to be of poor quality, a particular doctor
26 Achieving Service Excellence
to be inept, or the entire hospital to be a major disappointment. Just one unfortu-
nate incident can negatively inuence the opinion of the patient and anyone with
whom the patient comes in contact, either directly through talking or indirectly
through a blog entry. Many organizations have discovered that being average
or good is not good enough when one angry or dissatised customer decides to
seek revenge for a bad experience. Google any organization followed by the word
sucks and be amazed at the number of hits.
In this chapter, we address the following:
The meaning of guestology
The nature of service and service product
The three components of the total healthcare experience: service product,
service setting, and service delivery system
The relationship among quality, value, and cost.
WHAT I S GUESTOLOGY?
Guestology, a term coined by Bruce Laval, former senior vice president of planning
and operations at The Walt Disney Company (see Ford and Dickson 2008), is
the scientifc study of guests demographic characteristics, needs, wants, expecta-
tions, and actual behaviors. Guestology turns traditional management thinking
on its head because it forces the organization to systematically examine the service
experience through its customers points of view. The goal of guestology is to cre-
ate and sustain a customer-centered experience that effectively responds to guests
expectations and actual behaviors and, at the same time, meets nancial and clini-
cal objectives.
For a healthcare organization, guestology means studying patients needs, wants,
and expectations as well as observing their behavior while they are in the facility.
Findings of such a study then guide healthcare managers in changing or developing
services and practices that meet and exceed patient expectations of the organiza-
tions service product, service setting (also called environment), and service delivery
system. Guestology aligns the organizations strategy, staff, and systems with the
interests of the patient by starting with a study of the customer and her key drivers
of satisfaction.
With guestology, the saying, It all starts with the customer becomes the truth
(or mind-set) that everyone in the organization accepts and uses to guide every-
thing they do, say, and write.
Chapter 2: The Customer as Guest 27
Desired Qualities of Guest-Service Providers
In the Judeo-Christian tradition, the concept of kindness to strangers traces back
to the Israelites days of slavery in Egypt. In the Torah, the following is written:
When a stranger sojourns with you in your land, you will do him no
wrong. The stranger who sojourns with you should be to you as a native
among you, and you should love him as yourself; for you were strangers
in the land of Israel. (Leviticus 19:3334)
Early Christians believed that what separated the sheep from the goats on
Judgment Day was whether they took strangers in (Matthew 25). Early Chris-
tians built houses that served as lodging (where food was served) for travelers and
other strangers. Eventually, they added sections to these houses where sick travelers
could stay to get care and treatment for infectious diseases. After many centu-
ries, these houses for strangers were renamed hospitalsfrom the Latin hospitas,
meaning guest or host. Only much later did hospitals come to specialize in
caring for the sick and injured (Willis 2000).
Todays healthcare consumers are looking for the same type of hospitality from
their providers. Healthcare organizations must have functional service quality char-
acteristicsattributes of caregivers that please (and are easily evaluated by) patients.
Research has identied the ve most important service quality characteristics (Mit-
tal and Lassar 1998; Parasuraman, Zeithaml, and Berry 1988):
Responsiveness: willingness to help and provide services
Assurance: knowledge and courtesy of staff
Empathy: caring and individualized attention
Tangibles: availability of equipment and appearance of physical
environment
Reliability: ability to perform the promised service dependably and
accurately
Possessing these characteristics sets the stage for a superb guest experience and
turns customers into loyal patrons or repeat guests. Treating customers as guests
may seem simple, but it is a major undertaking that healthcare organizations must
master to compete successfully in a customer-driven marketplace (Ford, Heaton,
and Brown 2001).
28 Achieving Service Excellence
THE CUSTOMER SERVI CE CHAI N
Exhibit 2.1 shows how customer service begins and ends for a healthcare organiza-
tion. The external environment (top left corner of the exhibit) inuences custom-
ers expectations (bottom left corner), and vice versa (which is illustrated by the
two-way arrow). For example, some incentives within the industry may not be
supportive of the provision of high levels of customer service. If physicians are pres-
sured by managed care organizations to limit the time spent with each patient so
that they can see more patients, the physicians and patient will not be satised.
Consumer expectations refect both the present benefts of the healthcare ser-
vice received and the anticipated benefts of future services (MacStravic 2005).
If consumers are frustrated by elements of the external healthcare environment,
they may pressure the system to change. For example, several years ago consum-
ers rallied their political representatives to ease managed cares tight controls over
access to certain services and specialists. The managed care industry responded to
customers by loosening its grip. A high level of consumer satisfaction with a recent
service is a good predictor that the customer will use the service in the future.
Both the external environment and customer expectations have an impact
on the organizations strategies, staffng, and systems. For example, if the health
insurance plan does not reimburse e-mail communications between patients and
physicians but does pay for brief offce visits, then face-to-face interaction be-
comes the preferred medium of contact. The customers perception of the total
healthcare experience (second box from the right of the exhibit) is, in our opin-
ion, the true determinant of satisfaction with a service (which is short term) and
loyalty to the organization (which is long term), although many healthcare or-
ganizations may argue that their superb performance on clinical measures alone
drives their success.
If a customer thinks the experience exceeded his expectations, he is delighted
or thrilled. If a customer perceives that the experience met her expectations, she is
likely to be satised; but if she deems that the service fell below standards, she is
not only unhappy but also not likely to come back to the facility. While customer
satisfaction may be the result of an excellent, one-time encounter, customer loy-
alty results from repeated positive transactions over an extended period (OMalley
2004a). Over the long run, levels of customer satisfaction and loyalty can have
a tremendous impact on a businesss customer relationship and revenue stream
(Peltier, Schibowsky, and Cochran 2002). One bad encounter represents a lost op-
portunity for the organization to gain a loyal customer (and loyalty means not only
repeat service but also a referral).
C
h
a
p
t
e
r

2
:

T
h
e

C
u
s
t
o
m
e
r

a
s

G
u
e
s
t


2
9
Exhibit 2.1 SatisfactionLoyaltyOutcomes Chain
External Healthcare
Environmental
Incentives
Organizational Outcomes
1. Intent to return
2. Referrals of family and friends
3. Market share
4. Financial outcomes
5. Patient compliance
6. Litigation
Customer Satisfaction
(short term) and
Customer Loyalty
(long term)
Customer Perceptions
of the Total
Healthcare Experience
(expectations exceeded,
met, or
not met)
Healthcare Organization
Strategies, Stafng, and
Systems
Customer Expectations
for Clinical and
Service Quality
30 Achieving Service Excellence
One study of adult medical patients found an empirical link between customer
satisfaction and customer loyalty (Garman, Garcia, and Hargreaves 2004). The
results revealed that how well physicians and nurses attended to and provided in-
formation to patients and their families signifcantly infuenced patients inten-
tion to return to the institution. The nancial implications of this nding were
substantial.
This customer service chain ends with outcomes (last box on the right of the
exhibit). High and low levels of customer satisfaction and customer loyalty yield
different results. On the positive end, the organization may see an increase in pa-
tients intent to return, a greater likelihood that patients will refer the facility to
their friends and family, a growth in the market share, an improvement of the
bottom line, higher rates of patient compliance with treatment, and less litiga-
tion (Dube 2003; Harkey and Vraciu 1992; Nelson et al. 1992; Pink and Murray
2003). Conversely, low levels of satisfaction and loyalty are associated with negative
outcomes in all variables.
EXTERNAL OR PRI MARY CUSTOMERS EXPECTATI ONS
Discovering the Key Drivers of Satisfaction
Excellent service organizations intensively study the key drivers of people who use
their products. Key drivers are the needs, wants, and expectations that are most
important to customers, and they should be part of the organizations knowledge
base. The best way to learn these key drivers is to continually and carefully study
customers.
Many healthcare managers think they understand the factors that contribute
to customer satisfaction and intent to return. Most times, however, managements
perception does not represent the customers point of view, creating a disconnect
between what managers think consumers prefer and what consumers actually
want.
As mentioned earlier, Disney created and developed the concept of guestology
to learn about its customers expectations. Other superb service organizations train
their direct-contact employees to regularly ask guests about their customer experi-
ence. For example, the Ritz-Carlton has identifed 18 key drivers through the use
of customer surveys. Ritz-Carlton realized that these key drivers are so important
that it designated one employee in every one of its hotels to be in charge of ensur-
ing the delivery of each of the 18 key drivers (Ford and Heaton 2000).
Chapter 2: The Customer as Guest 31
Customer Relationship Management
Benchmark service organizations live by the old sayings the only constant is change and
success is never nal. That is, they exert much effort into identifying and responding to
changes in customer expectations and demographics. Indeed, this is the underlying prin-
ciple of customer relationship management, the organizational practice of focusing all activi-
ties on the needs, wants, and behaviors of its customers (Dickson, Ford, and Laval 2005).
According to Berkowitz (2006, 195), customer relationship management
(CRM) is the organizations attempt to develop a long-term, cost-effective link
with the customer for the benet of both the customer and the organization.
Simply, CRM shifts the service thinking from the individual transaction to rela-
tionship building. Thomas (2005, 309) states that CRM involves
the creation of a centralized body of knowledge that interfaces internal customer
data with external market data. This integrated data set can be analyzed to
determine patterns relevant for the task at hand. More specically, it involves
identifying customers and their past purchase behaviors for the purpose of
guiding future marketing decisions. It involves building a comprehensive data
base of customer proles and initiating direct marketing based on these proles.
Well-designed and well-implemented CRM programs yield substantial returns,
and new technologies only expand this opportunity. Common goals for a CRM
program include the following (Thomas 2005):
Improve customer service and satisfaction
Increase proftability
Reduce negative customer experiences
Allocate resources more effciently
Lower the cost of customer interaction
Attract and retain customers and prospects
Build stronger customer relationships
Improve clinical outcomes
Most organizations use customer satisfaction to defne CRM success. Given that most
hospitals already use patient satisfaction as a key performance indicator, adopting CRM
strategies should not feel like a big leap. However, healthcare organizations seem to have
a diffcult time switching from being inside-out driven to being outside-in driven. Kaiser
Permanente, Celebration Health, and Mayo Clinic all have made signifcant strides in
becoming customer (outside-in) driven. However, they are the exception, not the rule.
32 Achieving Service Excellence
CRM is ideal to apply to managing customers in the following areas or activities
(Thomas 2005, 313):
Disease management for the chronically ill
Employee assistance program
Physician-to-physician marketing
Community health screening and prevention
Frequent-customer program
Managing Expectations
Among the crucial infuences on expectations include the individuals needs, val-
ues, previous experiences, information from others, intentions, attributes, moods/
emotions, perceived consequences of outcomes, social/demographic background,
social norms, group pressures, and perceptions of equity (Thompson and Sunol
1995). Because benchmark healthcare organizations dig deep to discover the key
factors behind patient expectations, they are able to personalize (as much as pos-
sible) each patients service experience using the information at hand.
Some organizations even document patients expectations, along with their
clinical record, to ensure that the expectations are met on the patients next visit.
Other organizations manage patient expectations by providing accurate informa-
tion about their services ahead of time. That is, before the patient arrives, she
would have already read material or spoken to a staff member regarding the pro-
cedure or care she will receive. This type of information may be conveyed through
advertisements, preadmission calls, brochures, and website postings. The more ac-
curate the patient expectations are, the more likely the organization can meet or
exceed those expectations.
Superb hospitality and other guest-service organizations are also acutely aware of
the importance of setting expectations and living up to them. For example, Wendys
denes its offerings well: its food is high quality, its restaurants are open late, and its
restrooms are clean. Wendys customers, then, notice and get disappointed if the food
is subpar, the restaurants are closed early, or the restrooms are dirty.
Another example is the way Disney anticipates and meets expectations even be-
fore customers enter its amusement parks. Disneys guestology studies revealed that
when confronted with a choice in direction, people who are indifferent to where
they are going tend to go toward the dominant handedness. Because most guests
are right-handed, Disney built the road from the Magic Kingdoms Main Street
square to Tomorrowland (which leads right) wider than the road to Frontierland
Chapter 2: The Customer as Guest 33
(which leads left). This is guestology in practice, and any organization can benet
from a similar study of its customer needs, wants, behaviors, and expectations.
In healthcare, however, managing patient expectations is challenging because
patients needs and wants are ambiguous and variable. This is especially true if
the organization has infrequent or no previous contact with its patients. Un-
like visitors to a theme park, many patients are sick, are reluctant to get care,
value privacy, need whole person service, and are at medical risk (Berry and
Bendapudi 2007).
First-time patients may have generalized expectations, such as a clean room
and environment, knowledgeable and helpful staff, and a positive clinical out-
come. Repeat patients, on the other hand, are likely to have specic expectations
that reect their previous experience with the healthcare provider. This variabil-
ity is more reason for healthcare organizations to study the key satisfaction driv-
ers for all customers.
Furthermore, patients have high expectations of large healthcare organizations
with a well-known brandMayo Clinic, for example. Potential customers know
of Mayo Clinics superior reputation: They have read articles, have heard Mayos
name for years, and have possibly been referred to it by their primary care physi-
cian. When these frst-time patients arrive at Mayo Clinic, they are defnitely ex-
pecting outstanding services at all levels.
If the organization realizes that it cannot meet the identied patient expectations,
it must say so right away before the patient is disappointed. The institution must
assess its own capabilities and competencies so that it knows which patient expecta-
tions it can meet, thus avoiding the pitfall of overpromising and underdelivering. In
addition, healthcare managers must communicate any problems so that patients do
not develop unrealistic expectations at any point in the service experience.
Welcoming Complaints
Todays unhappy patients are no longer restricted to talking with friends and
neighbors over the backyard fence or the phone. They are also equipped with the
Internet, which can quickly spread their message of dissatisfaction to the whole
world. Websites that are dedicated to bashing noncustomer friendly providers
and organizations have proliferated. Enough negative write-ups or mentions on
these websites will severely affect an organizations reputation and put its business
model at risk. Furthermore, recruiting new customers is much more costly than
retaining an existing customer base (Mittal and Lassar 1998), a research nding
that was as true in the late 1990s as it is today.
34 Achieving Service Excellence
Surveys and interviews are not required to determine that most patients ex-
pect a positive experience from a healthcare provider. Patients complain when they
encounter factors or situations they do not expect. These complaints are a good
source of information, however. Examining what customers do not want can pro-
vide insight into what they do want. In his book Discovering the Soul of Service, ser-
vice expert Len Berry (1999, 31) lists the ten most common customer complaints,
which are still valid in todays healthcare marketplace. A common thread in these
complaints is that healthcare customers feel disrespected:
Complaint: lying, dishonesty, and unfairness by the organization and
employees
Patient expectation: to be told the truth and treated fairly
Complaint: harsh, disrespectful treatment by employees
Patient expectation: to be treated with respect
Complaint: carelessness, mistakes, and broken promises
Patient expectation: to receive careful, reliable healthcare and the promised
clinical outcome
Complaint: employees without the desire or authority to solve problems
Patient expectation: to receive prompt solutions to clinical and nonclinical
problems
Complaint: waiting in line because some service lanes or counters are closed
Patient expectation: to wait as short a time as possible
Complaint: impersonal service
Patient expectation: to receive personal attention and genuine interest from
employees
Complaint: inadequate communication after problems arise
Patient expectation: to be kept informed of problem-solving efforts after
reporting or encountering problems or service failures
Complaint: employees who are unwilling to make extra effort or who seem
annoyed by requests for assistance
Patient expectation: to receive assistance rendered willingly by employees
Complaint: employees who do not know what is happening
Patient expectation: to receive accurate answers to common questions from
informed employees
Complaint: employees who put their own interests frst, conduct personal
business, or chat with each other while the customers wait
Patient expectation: to have customer interests come frst
Chapter 2: The Customer as Guest 35
Using Customer Service as the Competitive Edge
When patients are unable to readily distinguish the difference in clinical quality
between one healthcare provider and another, the organizations excellent customer
service reputation can become its competitive advantage. This reputation is a
product of the organizations ability to combine its service product, service set-
ting, and service delivery system in a way that meets or exceeds the needs, wants,
and expectations of its customers. In a competitive market, customer service is the
competitive edge.
I NTERNAL CUSTOMERS EXPECTATI ONS
As mentioned in Chapter 1, internal customers include persons (all employees
and clinicians) and departments or units that depend on and serve each other. The
principles of an outstanding service experience apply not only to external custom-
ers but also to internal stakeholders.
For example, when a physician requests a patients x-ray flm from the radiology
department, a radiology technician should treat the request as if it were coming
from the patient himselfthat is, fulll the request in a pleasant, friendly, and
timely manner; provide the correct lm; ask clarifying questions if needed; and
offer to help in any way possible. If the radiology department does not meet the
physicians basic expectation (to acquire the patients x-ray quickly or by a certain
date), then the physician comes away from this transaction dissatised with radiol-
ogys service. Although the physician cannot stop using the organizations radiology
services (as an upset patient might), she can spread the word that the department
and its technicians are slow, incompetent, or inefcient. Furthermore, she might
become so frustrated that she refuses to practice at the hospital in the future, caus-
ing the hospital to lose any future revenues this physician may generate.
This same logic applies to the relationship between administrators and em-
ployees. All employees expect their employers to treat them fairly, with care
and consideration, and with respect for their dignity and abilities. This is the
same basic treatment that benchmark healthcare organizations ask their em-
ployees to extend to their patients and other external and internal customers.
Viewing employees as guests, thereby motivating and empowering them, is
critical to organizational success. (See Chapter 8 for a complete discussion of
motivating and empowering staff.)
36 Achieving Service Excellence
THE NATURE OF SERVI CE AND SERVI CE PRODUCTS
By nature, service occurs between two (or more) partiesthe consumer and the
provider. Usually but not always, service involves both a tangible and an intangible
component.
In healthcare, the intangibles are those that patients cannot take home, such as
the friendliness and responsiveness of the staff or the promptness and efciency of
the service. The tangibles, on the other hand, are those that patients can physically
hold or feel, such as a stethoscope or a thermometer. Sometimes, the intangibles
include a tangible part, and vice versa. This bundle or combination of the tangible
and the intangible makes up the service product.
Both the healthcare organization and the patient dene the service product, but
each party may dene it differently. For example, the organization may think the
service product is the positive clinical outcome of a heart transplant. Meanwhile, the
patient may perceive the service product as the sum of the whole experiencethat
is, it includes the successful operation as well as the clean room, caring and informa-
tive physicians, supportive and cheerful staff, and outstanding follow-up care. To
the patient, the warmth displayed by the caregivers and the bedside manner of the
surgeon may be more memorable than the clinical reason for the hospital stay.
For this reason, the organization should dene its service product in terms of
not only its own interests but also the needs, wants, and expectations of its pri-
mary customers. Long ago, Charles Revson, former head of Revlon, Inc., drew
this important distinction between what the company makes and what its clien-
tele buys: In the factory we make cosmetics, in the store we sell hope (Levitt
1972). This distinction is even more important today as patients seek positive
experiences and outcomes.
Tangible Versus Intangible
Manufactured products are different from healthcare service products because
manufactured products tend to be exclusively tangible. They are produced,
shipped, and purchased now for consumption later, and their producers (man-
ufacturers) have minimal, if any, interaction with the consumer. In contrast,
service products are often intangible and demand consumer contact and even
customer participation. The tangible itemeyeglasses, a prosthetic device, or
prescription drugs, for exampleaccompanies the intangible service. The com-
bination of the service product, setting, and delivery system denes the total
healthcare experience.
Chapter 2: The Customer as Guest 37
Purely intangible services can also be called service products if they are the
only product an organization offers. Think of it this way: A service product is
a general term that does not necessarily include a tangible item. For example, the
diagnosis of a disease is the service product. The service product consists of infor-
mation given by the doctor; the nurses ability to gather health information and
explain the doctors instructions; the promptness with which the front desk signed
the patient in and processed the payment; and the availability of the nurse to an-
swer questions before, during, and after the visit.
Interaction Between Customer and Provider
A study by Berry and Bendapudi (2007) enumerates the similarities between ser-
vices in healthcare and those in other industries. Like others, healthcare services
require intense labor and skill, offer intangible and tangible benets, are usually
provided in the presence of the customer, are often perishable, and are not readily
clear or understandable to the recipients. Interactions between the customer and
the provider are at the heart of healthcare service.
Exhibit 2.2 is a matrix of the types of interactions between the customer and
the service provider; it also lists common examples of services that t each type.
As the exhibit shows, different services call for different interactions. For example,
vending machines and ATMs (automated teller machines) do not require the pro-
vider to be present. Because the provider is not there when a customer uses these
machines, the provider must ensure that the system is foolproof for all types of
customers who encounter it. Take ATM services, for example. Not only are more
and more ATMs equipped with multilingual options, they have also become more
customer friendly, allowing users to conduct most of their banking needs without
Exhibit 2.2 Interaction Between Customers and Service Providers
Customer Is Present Customer Is Not Present
Service Provider Is Not
Present
Electric/gas utilities, ATM,
vending machine
Answering services, TV
security services
Service Provider Is Present
Healthcare, hospitality, other
professional services Lawn service, watch repair
38 Achieving Service Excellence
the help of bankers and tellers (Online Search Authority 2009). This functionality
is another way banks can forge relationships with their busy customers and hence
add value to the experience.
In healthcare and hospitality industries, the provider must almost always be pres-
ent when the customer is present. Here, the service interaction is the major means for
the provider to add value to the customers experience. For example, in a medical of-
fce, the receptionist or front-desk staff is responsible for not only greeting the patient
and ensuring that the clinician (physician or nurse) is aware that the patient is wait-
ing to be seen but also for processing payments and making follow-up appointments
later in the process. During this (hopefully) brief interaction with the front desk, the
receptionist represents the provider. As such, the receptionist can add value to the
encounter by exceeding the patients basic expectations for that part of the visit.
In healthcare, the only services that do not require providercustomer interac-
tion are those performed back of the house, such as lab work, insurance claims
processing, and plant maintenance. Advances in medical technology, however, are
widening the possibility of less direct contact between providers and patients. Re-
mote patient monitoringmostly geared toward patients with chronic illnesses
and the elderlyhas experienced tremendous growth. Two industry giantsGE
and Intelrecently announced a joint venture that will enable physicians to re-
motely monitor, diagnose and consult with patients in their homes or assisted-
living residences (Lohr 2009). Telehealth and robotic surgery are among the main
practices that allow clinicians and other caregivers to interact remotely and provide
care outside of the traditional care setting. As long as these innovations are de-
signed with patient capabilities in mind, they can enhance the service experience.
Implications of Service Intangibility
Service intangibility has several implications for healthcare managers:
1. Accurately and objectively assessing the intangible services quality or value is
impossible. The only way to measure its quality or value is through subjective
techniques, the most basic of which is to ask the customer. But even using
this technique is problematic because each healthcare customer has unique
needs and wants, so no two patient experiences are exactly alike. Every patient
judges a service on the basis of his or her own views and mind-set. Thus, the
less tangible a service, the more patient experiences will vary, regardless of the
similarity in what services they received and how they were treated.
Chapter 2: The Customer as Guest 39
2. Intangible services cannot be stockpiled or stored in an inventory. For example,
a 10:00 a.m. doctors appointment or an empty hospital bed on Monday
cannot be held for use on Tuesday. This temporal aspect of the service can
cause patient dissatisfaction, as patients think the healthcare organization
has capacity problems. Whether that perception is true or not, managers
must manage capacity. They must ensure that the facility can meet expected
volumes so that no patient has to wait a long time or go to another provider.
However, managers must also be careful about having too much capacity,
because if it exceeds demand, then the facilitys human and physical resources
will sit idle.
3. Intangible services are difcult to articulate in marketing efforts and to
comprehend by customers who have not experienced these services. Including
afrming photographs in advertising pieces, posting quotes and testimonials
by satisfed patients and families on the organizations website, publicizing
customer service and clinical quality awards, and seeking genuine
endorsements from respected community and civic leaders can go a long
way toward spreading the organizations good work. Such efforts make the
intangible tangible, help potential customers form a mental image of what to
expect, and guide employees in what to provide.
4. Intangible services require human interaction and coproduction. These
interactions can be face to face; over the phone; or by mail, e-mail, or text,
and they can be brief or lengthy. Regardless of the format, contact between
providers and customers shapes the customers perception of the organization.
Empowering the Service Provider
To understand and meet customer needs, wants, and expectations, healthcare or-
ganizations must work from the patient backward, which follows the concept of
guestology. Working backward entails training and empowering the people who
provide the services.
Benchmark organizations empower their employees, instead of tightening man-
agerial control systems (which is the practice of bureaucratic organizations), to
ensure consistency and predictability of service and employee behavior. They know
that no manager can watch every patientemployee interaction and that the staff
can make or break the healthcare experience.
Therefore, they place their trust on the capabilities of service providers, to
whom they provide ample guidance on and training in customer service principles
40 Achieving Service Excellence
and organizational mission. Furthermore, these organizations help their employees
understand that the organizational mission must be aligned with employee behav-
iorthat is, everything they say must be in concert with everything they do.
Rather than review employees performance only on an annual basis or after a
negative event, healthcare managers should provide ongoing coaching, feedback, re-
sources or tools, and education on a broad set of topics, including customer service.
Well-trained and mission-driven staff will provide excellent service.
From Service Economy to Experience Economy
Too few organizations in all industries yet understand that, for many consumers,
well-made goods or well-rendered services are no longer suffcient. More and more
customers want and expect a memorable experience from the service or product
for which they paid. Of course, in healthcare, hospitals are still expected to provide
high-quality care at a fair price, doctors are still obligated to prescribe appropriate
medications and treatments, and insurance companies and other payers are still
relied on to pay the bills on time. However, patient expectations have gone beyond
those basics.
In their publications, authors Pine and Gilmore (1998; 1999) argue that so-
ciety has moved from an industrial to a service to an experience economy. In an
experience economy, businesses must offer products and services that are memorable
and personal for the customers. As a response to this shift, some healthcare or-
ganizations (e.g., North Hawaii Community Hospital, Baptist Health Care, and
Mid-Columbia Medical Center) have incorporated innovative patient experiences
into their practice, such as offering a total healing environment, installing a wow
team, and making the facility feel more like a cozy inn than a rigid hospital (Pine
and Gilmore 1999).
The underlying lesson here is that patients should not be viewed as statistics or
as abstract representations of societys healthcare recipients. Each patient is unique,
and each presents to the facility with varying emotions and levels of need. They can
arrive calm but may be in need of pain medication and serious medical interven-
tion, or they may show up frustrated and afraid but may only need a conrmation
that they will be okay. The key to appreciating these differences is learning about
the patients, as discussed earlier and as illustrated by guestology. A healthcare or-
ganization would want to know not only what ails the patient physically but also
what drives the patient mentally and emotionally (e.g., attitudes, beliefs, values).
From there, the organization can create a memorable healthcare experience that is
tailor made for the patients needs, wants, and expectations.
Chapter 2: The Customer as Guest 41
The caveat is that meeting the needs, wants, and expectations of a patient
who arrives already agitated can be challenging. For example, most dental pa-
tients neither enter nor leave the dentists offce flled with joy. If the clinical
outcome turns out to be negative (a botched root canal, for example), the chal-
lenge to satisfy the patient intensies. However, healthcare literature shows
even if the clinical outcome is less than satisfying (but not too negative), a
provider can stem or minimize lawsuits or poor evaluations by attending to the
nonclinical aspects of the healthcare experience (Studdert, Melo, and Brennen
2004). Several studies have shown that up to 80 percent of all medical malprac-
tice suits have nothing to do with the clinical quality of the medical services
delivered (Berkowitz 2006). A major reason for lawsuits is that the patient or
loved ones were angered by the way in which service was delivered, indepen-
dent of whether the care was injurious.
As Exhibit 2.3 shows, a relationship exists between a patients medical status
and the importance of the total healthcare experience to that patient and his fam-
ily. Generally, the sicker the patient, the less concerned she is about the service
experience. For example, a patient who has lung cancer is focused on getting ap-
propriate and exceptional clinical treatment, not the cleanliness of the bathroom
or the cheerfulness of the staff. Conversely, a patient who just received a clean bill
of health from a physician tends to notice how welcoming the front desk and the
receptionists were or how long the appointment delay was. Regardless of a patients
health status, however, the healthcare organization should provide the best possible
Exhibit 2.3 Relationship Between Probable Clinical Outcome and the Importance of
Service Quality
Positive
Probable
Clinical
Outcome
Service Quality Importance
Negative
Routine Exam Having a Baby Heart Surgery High-Risk Surgery
42 Achieving Service Excellence
healthcare experience for all its patients because, many times, the positive can off-
set the negative.
THE TOTAL HEALTHCARE EXPERI ENCE
The total healthcare experience is the sum of all the activities that fall within the
three main components of serviceproduct, setting, and delivery system.
As mentioned earlier, no two healthcare experiences are exactly alike because
each patient has unique needs, wants, and expectations. This uniqueness becomes
the primary challenge for healthcare organizations, but it should not prevent
providers from at least trying to enhance the healthcare experience. Benchmark
healthcare organizations spend considerable time, effort, and money to ensure that
each part of the total healthcare experience adds positive value. They look for and
correct service mistakes, and they use probability models to predict how their cus-
tomers will react or respond to services. OMalley (2004b) argues that healthcare
administrators can improve the total healthcare experience by performing a service
inventory of all critical customer-contact points. Armed with an inventory list,
managers can identify areas of weakness and address the needs of each area, thereby
improving them.
Service Product
The service product is the primary reason that a patient comes to a healthcare
provider. In fact, the name of many healthcare businesses reects their service
productfor example, Orlando Regional Medical Center, Orthopedic Associates,
CVS Pharmacy, Jones Chiropractic Clinic, Millhopper Family Dentistry, and Vi-
sionCare.
Most service products consist of both tangible and intangible elements, and the
rest are solely dependent on the intangible, such as the expertise of the provider.
Almost always, patients primarily seek the intangible product, and a tangible item
may or may not accompany the service. For example, when an elderly patient con-
sults with an orthopedic doctor regarding the pain in his hip, the patient is there
to get expert advice and opinion, not to buy an articial hip. If the orthopedic sur-
geon deems that a hip replacement is necessary, the patient will receive the articial
hip. In this case, the combination of the intangible (including the orthopedists
knowledge and experience) and the tangible (including the articial hip) composes
the service product. Sometimes, however, the service product does not include a
Chapter 2: The Customer as Guest 43
tangible item, which makes paying attention to the intangible aspects even more
important for the provider.
Service Setting
The term servicescape or healthscape refers to the physical environment in which the
service product is provided.
The service setting includes the layout of the unit/department, rooms, receiv-
ing and waiting areas, cafeterias, and other private and public spaces; employee
dress code; the background or ambient music and noise; the lighting, signs, wall
hangings, and other decorative elements; and equipment and supplies. Every as-
pect of the service setting communicates to patients and other customers whether
the organization is orderly, clean, and capable and ready to render services. Most
important, the setting articulates whether the organization understands the needs,
wants, and expectations of its customers.
A service setting that is spotless, has good air and trafc ow, and is pleasant to
the customers senses can promote patient healing and satisfaction, among many
other benets.
Service Delivery System
The service delivery system has by three organizational components:
1. Clinicians and employees. This component includes not only physicians and
nurses but also orderlies, receptionists, billing clerks, and other personnel.
2. Physical production tools. This component includes the technology,
equipment, supplies, and space used in the course of producing and
delivering a service.
3. Organizational processes and information systems. This component includes
admission, discharge, accounting, patient records, clinical information,
operations management, communications, housekeeping, and food services.
The healthcare delivery system is unlike the manufacturing assembly line. Gen-
erally, a factorys product is created behind closed doors, is always tangible, and
is often delivered through an intermediary. In healthcare, on the other hand, the
product is on demand, intangible, and delivered directly, thus making it an experi-
ence rather than an object.
44 Achieving Service Excellence
All aspects of the delivery system are equally important and must be managed
well, separately and together. The most challenging of these three is the people
component. Many patients and other customers gauge the value of their service
experience on the basis of the staff s or the clinicians attitude, concern, and help-
fulness. At the moment of the encounter, the patient views that one clinician or
employee as the representative for the entire department, the entire organization,
or even the entire healthcare industry. Thus, if that one clinician or employee be-
haves unprofessionally, gives inaccurate information, fails to meet basic expecta-
tions, or disregards the patients viewpoint and preferences, the patient can regard
the entire service experience as dissatisfying. This one event can set off an avalanche
of negative consequences for the organization, as the patient proceeds to tell others
about the experience.
Moment of Truth
The term service encounter refers to the time in which an interaction or a series of
interactions (which is usually face to face) takes place between the customer and
the service provider. In healthcare, the length of a typical service encounter varies
depending on the service sought. For example, a chest x-ray is considered a brief
procedure that lasts less than 30 minutes, while a meeting between a patient and
a billing clerk could take more than an hour. One hospitalization involves dozens
of service encounters.
Any service encounter can make or break the total healthcare experience. Jan
Carlzon (1987), the former president of Scandinavian Airline Services (SAS) who
reenergized the stagnant company by adopting a customer service focus, termed
the rst fteen golden seconds of service encounters as moments of truth. Every
service encounter a customer has with a provider has the potential to make or break
customer satisfaction and customer loyalty.
In healthcare, the moment of truth can extend beyond the rst 15 seconds and
involves more than personal interactions. The healthcare moment of truth refers to
any patient encounter with the three components of the service delivery system
with a nurse assistant, with an ATM on the premises, or with a discharge system.
Managements responsibility is to ensure that its staff and systems are capable of
handling these moments of truth.
Following are recommendations from customer service experts that can enable
employees to shine at the moment of truth (Zibriskie 2009):
[Do not] act as though patients are dead.
Ask patients for information at the time they arrive.
Be mindful of others who can hear what you are saying.
For many people, the issue of weight is sensitive and [should not] be
Chapter 2: The Customer as Guest 45
broadcast. Just write it down, and [do not] argue with patients who insist
the scales are wrong.
Unless otherwise directed, call adult patients Mr., Ms., or Mrs.
Know the difference between being pleasant and friendly and being too
personal.
Clean up your act to establish credibility.
Never talk about patients within earshot of other patients.
Let the patient know what you are getting ready to do and the degree of
discomfort she will likely experience as a result.
Slow down, and speak in plain English (or get a translator, if necessary).
The Beryl Institute (2007) studied one particular moment of truth in hospi-
tals: when a customer or potential customer calls the hospital switchboard. Find-
ings from this research indicate that the interaction between the customer and the
switchboard operator has the potential to enhance or detract from customer service
success. Specically, the study found that
more than 12 percent of switchboard operators incorrectly told customers that
the hospital had no referral system;
more than 40 percent of callers were given another number to call for
physician referral, rather than being transferred to the referral hotline, and
only 40 percent of callers were transferred to the hotline; and
nearly 8 percent of callers were transferred to the wrong number.
In light of these ndings, the Beryl Institute recommends the following strate-
gies for improving customer contact:
Start at the top.
View each call as a potential (or repeat) customer.
Implement technology.
Communicate, communicate, communicate.
Train for results.
Provide benchmarks.
Staff appropriately.
Hire outside support to make assessments and recommendations.
Although these recommendations are specifc to enhancing the patients switch-
board experience, they may also apply to other customer-contact areas. To see the
46 Achieving Service Excellence
complete list and explanations of these strategies, go to www.theberylinstitute.net/
publications.asp.
Critical Incident
In general, a critical incident is an event so unusual that it can cause a change in
mind-set, behavior, or plans. These incidents may or may not be adverse and, as
such, may be classied as customer satisers or dissatisers. In healthcare, however,
a critical incident refers to negative occurrences, such as the following:
Multiple complaints about the long wait for a routine doctors
appointment
Miscommunication between the pharmacy and the nursing staff about a
physicians order
A patients refusal to comply to prescribed medication or treatment
An employee action that undermines the organizations ethical policy
A clinicians failure to get patient consent or approval for a delicate
procedure
These critical incidents can lead to dire consequences, from confusion to loss
of the customers business to litigation to death. To minimize these eventualities
and encourage a trusting environment, one healthcare organization established a
policy to disclose all critical and sentinel events to its patients. Created in 2006,
this policy includes a list of items that must be documented to show disclosure of
a critical incident has taken place (Thompson 2009). According to this organiza-
tion, patients and their families nd this transparency valuable.
QUALI TY, COST, AND VALUE
In healthcare and other service businesses, quality, cost, and value have spe-
cial meanings. Two equations (discussed later) can clarify these meanings and show
how quality and value are determined, not in an absolute sense but by the customer
(Heskett, Sasser, and Hart 1990, 2).
Because healthcare service is mostly intangible and patient expectations are
variable, no objective determination of quality level (and therefore of value) can be
made. In manufacturing, a quality inspector can dene and determine the quality
of a product before a customer even sees or receives it. But in healthcare, that is
not possible. Physicians, other clinicians, and medical experts do their part: They
Chapter 2: The Customer as Guest 47
develop the standards and protocols for delivering and achieving the best possible
health outcomes, and they assess the effectiveness and quality of those methods.
However, as mentioned, healthcare consumers today are more involved. They are
making their own determination of a services quality and value, and their perspec-
tive is not solely focused on clinical success.
In this consumer-driven environment, healthcare managers must make the
patient believe that he is always right. Even when the patient is wrong, the
manager must allow that patient to be wrong with dignity. For example, if the
patient is accusing the clinic of selling his medical records to pharmaceutical
companies, the clinics manager cannot simply deny the allegation and quote
HIPAA rules. The manager must provide the patient with evidence that sup-
ports the clinics privacy policy and must calmly address the patients concerns.
This way, the discussion remains professional but friendly, and the patient does
not feel disrespected.
Quality
The quality of the total healthcare experience is evaluated by comparing the qual-
ity the customer expects against the quality the customer gets. If no difference
exists between the expectation and the actual, quality can be rated as average or
normalthat is, the patient received what she expected and is thus satised. If the
actual exceeds the expectation, then quality can be rated as positive. Conversely, if
the actual fails short of the expectation, then quality is viewed as negative.
The quality of two distinct organizations can be assessed this way also. A patient
will perceive that a neighborhood health clinics quality is more superior than that
of an academic medical center if the services he received at the clinic exceed his
(somewhat lower) expectations, while the services at the medical center did not live
up to his (somewhat higher) standards.
This method of determining quality can be expressed with this equation:
Qe = Qed Qee.
Here, Qe is the customer-perceived quality of the healthcare experience, Qed is
the quality of the actual or delivered experience, and Qee is the quality expected.
If Qed and Qee are equal or about the same, the Qe is average or normal. If the
Qed is higher than the Qee, the Qe is above average. If the Qed is lower than the
Qee, the Qe is below average. Ideally, the Qed should be higher than the Qee in
all aspects of the total healthcare experience.
48 Achieving Service Excellence
Quality under this defnition is not necessarily dependent on cost or value, but
they may be related. Quality is determined by the difference between what was
expected and what the patient experienced. A healthcare consumer may be dissatis-
ed with the value (because of high costs), but he may view the quality positively.
High quality, as perceived by the consumer, will enhance the consumers percep-
tion of value and will lower costs.
Cost
Cost is the sum of all the tangible and intangible expenses associated with a given
healthcare experience.
For example, the monetary costs of eye care include the exam, the glasses or
contact lenses, the optometrists fee, and the necessary supplies for the glasses or
contact lenses. If the patient has vision insurance, a health savings account, or
other coverage and discount plans, these costs are minimized. Opportunity costs
are also incurredthat is, if the patient opted to go to another eye center or forgo
the doctor appointment altogether, would she have saved money?
Assigning a dollar fgure to the patients time is diffcult, but time cost must be
considered. The patient is devoting a signicant amount of time to the entire care
process. She has to make an appointment, commute to the eye clinic, wait to be
seen by the optometrist, get measured or tted for the glasses or contact lenses, and
pick up the nal product. Finally, a risk cost exists. The patient faces a risk, slim
but real, that the clinics staff or system will damage her vision.
Value
The value (Ve) of the total healthcare experience is determined by comparing the
quality delivered (Qed) against all costs (monetary and nonmonetary). This rela-
tionship is expressed in this equation:
Ve = Qed Costs.
Patients expect quality to match with cost. That is, if they receive poor quality,
they expect low cost; on the other hand, if they receive excellent quality, they expect
high cost. If quality is proportionate to the monetary cost, then patients will deem
the healthcare experience a fair value but will not necessarily be impressed; after all,
Chapter 2: The Customer as Guest 49
they are still paying. Many healthcare organizations add value to the experience
by offering amenities or extras without increasing the price of the service.
The cost of quality is an important concept in the service industry, including
healthcare. These organizations want their customers to realize that although the
monetary cost of providing quality service is high, the economic and risk costs
of performing poorly are even higher. Fixing errors, compensating customers for
those errors, turning around low employee morale, convincing patients to return,
and combating negative word of mouth are just some of the inevitable expenses of
poor service quality.
Preventing and recovering from errors are so critical that Chapter 13 is devoted
to this topic.
CONCLUSI ON
Guestology is helpful in organizing consumer knowledge in the hospitality and
service industries. But the concept can also be applied to healthcare organizations.
In this environment of global economic crisis, the idea of treating all customers
(internal or external, primary or secondary) as guests can benet any healthcare
enterprise and give it a competitive edge.
Why should leaders think of staff and physicians as guests as well? The answer
lies in a leaders answer to this question: Which organization would you prefer to
patronize or work foran organization that treats everybody well or an organiza-
tion that considers people an interruption and a nuisance?
The answer should be obvious. The healthcare organization that patients and
staff prefer invests time, money, and energy to determine their needs, wants, and
expectations and their opinion of quality and value. Then, that facility offers this
type of experience and expresses its sincere appreciation for customers patronage.
This organization cares about not just the clinical service it provides but also the
total healthcare experience. The ultimate goal is to exceed expectations and in so
doing make customers return and spread positive word of mouth.
When matters of life and death are involved, the clinical side becomes front and
center, of course. The patient, family, physicians, and other caregivers are focused
on improving the health condition, not the attitudes of the staff or the ow of the
waiting room. But in other situations, the nonclinical aspects of healthcare are im-
portant and can determine the success or failure of a healthcare enterprise.
50 Achieving Service Excellence
Service Strategies
1. Treat each patient like a guest.
2. Study your customers (be a guestologist). This effort will reveal, among
other things, the customers defnition of quality and value, which is likely
different from the organizations defnition.
3. Recognize that we live in an experience economy by designing services that
provide memorable moments.
4. Manage the three components of the total healthcare experienceservice
product, service environment, and service delivery system.
5. Calculate the tangible and intangible costs of services. Remember that the
costs of providing high-quality care are low when compared with the costs
of errors and all the consequences.
6. Underpromise but overdeliver. Expect that customers have high
expectations, and strive to deliver the best outcome.
51
Those who fail to plan, plan to fail.
Leaders who are not planners are simply caretakers and gatekeepers.
Major General Perry Smith, U.S. Air Force
C H A P T E R 3
Enhancing Customer Service Through Planning
Service Principle:
Identify and focus on the key drivers of customer satisfaction
in strategic planning
The service strategy is an outcome of the comprehensive effort to align the
organizations mission with all other activities specifed in the strategic plan. An ef-
fective plan requires managers to analyze internal strengths and weaknesses and to
forecast external opportunities and threats. These analyses and forecasts are used to
systematically align all organizational activities and actions with the mission.
Developing and implementing a strategic plan are simple to talk about but are
difcult to do. In theory, the basic steps are straightforward: identify or review the
mission, vision, and values statements; conduct an environmental and internal as-
sessment to determine threats, weaknesses, opportunities, and strengths; develop
a strategic plan and specic actions that are aligned with the mission, vision, and
values and resources; and monitor the plan and results regularly.
Unfortunately, patient expectations change often and quickly, competitors du-
plicate and even take away the organizations competitive advantages, governments
pass new laws and regulations, and technological advances make current systems
obsolete. When the only constant is change, strategic planning is challenging. The
healthcare organization must change to stay competitive and viable.
In this chapter, we address the following:
The strategic planning process as it relates to the service strategy
Environmental assessments
52 Achieving Service Excellence
Action plans
The alignment audit
Methods for enhancing a service strategy, with examples from benchmark
organizations along the way
THE STRATEGI C PLANNI NG PROCESS
Benchmark organizations work hard to discover the kinds of experiences that cus-
tomers view as meeting or exceeding their expectations, and they plan ways to
deliver them. In healthcare, many exemplary organizations have identied strate-
gies and tactics to meet these expectations. Examples include boutique medicine,
medical homes, patient information systems, health savings accounts, and healing
environments. All of these will be discussed in this book.
The strategic planning process not only aligns the efforts and activities of the
organization but may also spark innovative thinking because it requires organiza-
tions to understand, anticipate, and even create the future needs of their custom-
ers. Although a detailed explanation of the healthcare strategic planning process is
beyond the scope of this book, we offer an overview of the main components of
strategic planning as a framework for customer service and patient satisfaction:
Mission, vision, and values. The mission articulates the organizations
purposethe reason it was founded and the reason it exists. It denes the
path to the vision and ensures the values are incorporated into organizational
actions. It guides the overall organization in how it delivers its product or
service and should incorporate its commitment to service excellence. The
mission, vision, and values drive the design of the service product, setting, and
delivery system. The vision clearly communicates the organizations desired
state in the future. Because it communicates a goal or an aspiration, the
vision can inspire and unite employees to achieve the common ideal. Values
represent the priorities of the organization and its stakeholders, including its
employees and its customers; examples of values include excellent customer
service and clinical excellence.
Environmental assessment. This component (the long look around)
evaluates the surrounding environment to identify external opportunities
and threats, which in turn enables the organization to generate strategic
premises. These premises are educated guesses concerning how the future
external environment may change depending on recent and current data and
experience. The premises then form the basis of the service strategy.
Chapter 3: Enhancing Customer Service Through Planning 53
Internal assessment. This examination (searching within) aims to determine
the organizations own strengths and weaknesses. An internal assessment leads
to an adjustment, a denition, or an afrmation of core competencies, which
enable the institution to compete in the future.
Alignment audit. Just as a fnancial audit ensures that the funds are used
properly, a strategic plan audit ensures that the proposed activities, plans,
tactics, and policies are aligned with the established mission, vision, and
values.
Each of these components is explored in later sections. As shown in Exhibit
3.1, healthcare strategic planning begins with the mission and vision and ends with
specic action plans for management, employees, capacity, budget allocations, and
marketing. Typically done annually, strategic planning should follow a predict-
able time framefor example, every Augustto keep everyone focused. No plan
should be set in concrete. As things change, the plan must change. The plan must
Environmental
Assessment
(
long look around
)
Internal
Assessment
(searching within)
V
Values
ision
Mission
Service Strategy
Product Design Setting Design Delivery System Design
Action Plans
(with performance measures)
Management
Performance
Plan
Capacity
Utilization
Plan
Budgeting Plan
Financial/ Employee
Hiring/
Training/
Retention
Plan
Strategic Premises Core Competencies
Strategic Plan
Marketing
Plan
Exhibit 3.1 The Healthcare Strategic Planning Process
54 Achieving Service Excellence
be exible enough to allow for changes in the environment, the organization, and
the customers expectations.
Strategic planning is a systematic effort to apply rationality and predictability
to an irrational and unpredictable world. Thus, it will inevitably lead to missed
opportunities, mistakes, wasted time, and frustration. Nevertheless, the process is
worthwhile. Although no one knows exactly what the future will bring, everybody
has to anticipate and prepare for it.
Strategic planning provides the organization with a method not only for mak-
ing the best possible decisions today to operate in the future but also for commu-
nicating the desired direction to all stakeholders. Once the mission, vision, and
values are articulated and the internal and external assessments are completed, the
organization can develop and implement the service strategy that will best meet the
future needs, wants, and expectations of its customers.
FORECASTI NG TOOLS FOR EXTERNAL ASSESSMENTS
Many forecasting tools are available, ranging from quantitative or objective
methods to qualitative or subjective techniques. Quantitative methods include
statistical forecasting, design day, and yield management. Qualitative methods
include brainstorming, the Delphi technique, focus groups, scenario planning,
and creative thinking.
The principle behind most forecasting tools is that the future is connected in
some predictable way to the past. For example, if in the last 30 years a hospitals
patient growth rate has been about 5 percent per year, the assumption that the
growth rate in the coming ten years will stay the same is reasonable. Similarly, if a
clinics records for the last two years show that a certain percentage of all patients
scheduled for the day do not show up, use of physician time can be improved by
allowing for no shows when scheduling patient appointments.
Unfortunately, using past data to predict future outcomes can be misleading.
Innovation (technological or otherwise) can disrupt statistical trends. For example,
when the telephone rst became widely used, a xed number of operators were
needed for each telephone system. If population growth were used exclusively back
then to predict the number of operators needed today, without accounting for
factors such as improved technology, the number of operators forecasted for today
would be in the millions. Of course, telephone operators are now obsolete. The
point is that predictions based only on past and limited experiences and informa-
tion can be invalidated by advances in technology, work productivity, and other
societal changes that may not be foreseeable.
Chapter 3: Enhancing Customer Service Through Planning 55
Over the years, lifestyle trends have been the basis of many astute business pre-
dictions. For example, the availability of the automobile led to the forecasting of
related needs or services: More motorists signaled interstate highways, while more
highways signaled roadside hotels, eating accommodations, and rest stops. One
of Walt Disneys astute calculations was that the growth of the interstate highway
system would result in the development of the theme-park industry. In the 1970s,
amid rising healthcare costs, several entrepreneurs predicted that employers and
governments (local, state, and federal) would be looking for ways to manage costs.
One result of this forecast was the establishment and subsequent growth of for-
prot healthcare providers and managed care organizations.
Forecasting techniques are useful in determining the impact of past experiences
and trends on future business. However, they are but one part of the external as-
sessment process, which requires thoughtful consideration of other sources and a
creative ability to see the connections between todays and tomorrows customer
needs, wants, and expectations.
Quantitative Techniques
An accurate forecast of future demand enables the healthcare organization to make
adequate capacity available. This is true for both clinical and nonclinical capacity.
Ensuring appropriate coverage is a basic patient expectation in todays market-
place.
Statistical Forecasting
Econometric, regression, time series, and trend analysis are major types of statisti-
cal tools. Each type shows that a denable and reliable relationship exists between
or among variables.
Econometric models are elaborate mathematical descriptions of multiple and
complex relationships that are statistically assembled as systems of multiple regres-
sion equations (Pearce and Robinson 2005). An econometric analysis can show
the impact of population growth, income changes, and changing demographics on
projected demand for a particular health service. In regression analysis, variations
in dependent variables are explained by variations in one or more independent
variables. Time series and trend analyses extrapolate past data into the future. A
time-series forecast will project the future rates in total demand, patient waits,
and occupancy rates, for example, on the basis of growth rates in the past (say, the
last ten years). These numbers may also be adjusted to account for changes in the
economy.
56 Achieving Service Excellence
Design Day
Building a new facility (e.g., hospital, clinic, life care community) entails capacity
planningthat is, determining how big it should be and how many patients it can
serve at one time. A facility cannot be designed to accommodate extreme levels of
demand (such as after or during a natural or man-made disaster or a pandemic)
because doing so is too expensive. Conversely, a facilitys capacity should not be so
limited that it is unable to meet normal anticipated demand.
The design-day method is helpful in planning capacity before a facility opens
and even afterward, when capacity is already xed but has to be expanded. Based
on information derived from past experiences and knowledge of the demand pat-
terns in similar facilities, the design-day capacity decision can allow the facility
to be built to accommodate the demand that is likely to t the service mission. If
the decision is to build to accommodate demand half the time, the facility will be
unable to handle demand the other half. Patients will be unhappy, and other stake-
holders will be upset. On the other hand, if the design day is set at 100 percent
of the time, the facility will be underutilized whenever the highest level of patient
demand isnt reached.
To illustrate this concept, consider a clinic that wants to expand capacity. The
clinic uses past and predicted patient volume gures to tentatively set the design
day at the 50th percentile. This means demand will exceed capacity 50 percent of
the year, and capacity will exceed demand 50 percent of the time. Because the clinic
is customer focused, however, and does not want patients to experience excessive
wait times (when demand exceeds capacity) at any time, it changes the design-day
percentile to a higher percentile. The higher the percentile, the lower the number
of days that patients have to experience long wait times. For example, if the design
day is set at the 75th percentile, the clinics wait-time standards are exceeded on
only about 90 days of the year. If set at the 90th percentile, the standards are ex-
ceeded on only about 36 days of the year.
A high percentile design day means an increase in capacity and hence requires
additional investment in capital and human resources. A low percentile design day,
on the other hand, costs less initially, but because it means a decreased capacity,
it tends to result in patient dissatisfaction. This dissatisfaction could discourage
repeat visitation, lead to negative word-of-mouth recommendations, stunt rev-
enue growth, and increase the risk of litigation. Management must balance the
trade-offs when establishing the design-day percentile: A high level is expensive
but meets customer expectations, while a low level is cheaper but may result in
dissatisfaction.
Chapter 3: Enhancing Customer Service Through Planning 57
Yield Management
Yield management is the process of maximizing the protability and use of exist-
ing capacity. Pioneered by the airline industry, yield management relies on timely
information about available capacity and customer demand so that the right capac-
ity (such as airline seats) can be sold to the right customer at the right price. This
method is advantageous to organizations that have limited capacity and perishable
products or services. Because capacity planners must have accurate and up-to-the-
minute data, they cannot properly apply yield management without computers
and links to Web-based information systems.
Yield management allows a healthcare organization to quote different rates to
different people or groups. For example, HMO patients may be charged prices
lower than those given to patients who are under a different or no insurance plan,
or different rates could be offered to elective surgery patients to ll in gaps in a
medical facilitys schedule. A yield management approach encourages the organiza-
tion to base its pricing structure on three factors:
1. Bargaining power of a group and its importance to the organization
2. Demand patterns by customers
3. Capacity projected to be available at any given time
Qualitative Techniques
Among the qualitative or subjective tools that an organization may use are
brainstorming, the Delphi technique, focus group, and scenario building or war
gaming.
Brainstorming
Brainstorming is a strategy that entails having members of a group generate as
many ideas as possible about a certain topic without stopping to evaluate the de-
tails or the usefulness of the ideas. The goals of brainstorming are to spark cre-
ativity, generate many possible alternatives, promote participation, and encourage
teamwork. In a forecasting discussion, brainstorming opens up the minds of the
participants to yield creative and novel insights into trends, perspectives, and other
information that may not have been revealed had the discussion not been opened
to team participation or if criticism or evaluation had been allowed during the
brainstorming session.
58 Achieving Service Excellence
Of course, brainstorming does not work for everybody. According to a survey
by BNET and Harris Interactive, 37 percent of respondents dislike their teams
brainstorming process; specic complaints are that opinions are not heard and
participants are unclear about goals (Palfni 2008). Neverthless, brainstorming has
the potential to bring about innovative ideas and informed forecasts.
Delphi Technique
The Delphi technique is a structured, multistep method that draws on expert
knowledge to forecast an unknowable future. Lets say a hospital wants to know
what percentage of overall surgical capacity will be lled at this time next year.
The hospital calls on a panel of industry experts to make individual estimates
on the basis of their knowledge about past patterns and current trends. Then
the hospital compiles and averages the estimates. The hospital then shows the
experts the summary, along with the reasoning behind each experts estimate
(without the experts names, however), and ask them for a second round of
estimates. The process is repeated until the variance of the experts estimates is
narrowed down.
The Delphi technique cannot guarantee a precise forecast of the future, such as
how many elderly people will need hip replacements. However, this method relies
on the best information available from experts and thus can yield a reasonable
estimate.
Focus Group
A focus group is a discussion facilitated by a trained leader about a specic issue.
Often, focus groups are held to assess the quality of a product or service already
received or rendered, but they can be conducted also to determine customers pref-
erences or wishes for a future offering or innovation. In this case, the organization
forms a focus group that is demographically and psychographically (e.g., values,
attitudes, interests) representative of its target market. For example, senior citizens
are frequently asked to discuss their opinions and expectations related to healthcare
services for the elderly. Findings from these focus groups are used to forecast future
needs of aging patients.
Scenario Building or War Gaming
With this technique, a certain future situation or scenario is imagined, and its im-
plications for the organizations operations are assessed. For example, a diagnostic
clinics future scenario may be the rapid rise of online diagnostic services. Under
Chapter 3: Enhancing Customer Service Through Planning 59
this scenario, people will be able to schedule appointments, nd related clini-
cal information, pose questions to a physician, receive test results, and get a
second opinion if needed. The downside of this innovation is that people may
no longer opt to travel to a physical diagnostic clinic if they can get full service
on the Internet. If this scenario becomes a reality, how will the clinic entice its
patients back? The answer may be some form of organizational redesign.
Although scenario building stimulates creative thinking, it should be based on
realistic situations, not on conditions so imaginative that they yield even unlikelier
implications and solutions and thus render the exercise futile.
Predicting Other External Factors
The environmental assessment also examines trends and changes in the wider so-
ciety, including demographics, technology, market expectations, politics, policy,
economics, competition, foreign trade, workforce, and sources of capital. All of
these factors will affect the way the organization strategizes today and develops in-
novative services and initiatives in the future.
Some factors are both simple and easy to predict because hard data already
exist. For example, estimating the number of people who will be eligible to
join the workforce in ten years is a straightforward calculation based on cur-
rent birth and immigration rates. On the other hand, some factors are simple
but unpredictable because they entail multiple variables. For example, estimat-
ing the number of skilled and trained people who will join the workforce in
a certain geographic area in ten years is complicated to calculate because of
many unknown variables, such as population growth, education variability,
and migration into and out of a location. Migration is inuenced largely by
location of jobs, and job location is stimulated by the ups and downs of tech-
nology. If technology advances to the point that most healthcare services can
be performed remotely, some jobs at local facilities may be lled by people at
a distant location.
A complete environmental assessment uses both quantitative and qualitative
tools to consider all external factors, regardless of how complicated the factors are
to predict, measure, or categorize. The assessment leads the way to the strategic
premise or informed predictions for the future. Even if the predictions are not
wholly accurate, a strategic plan prevents the organization from reacting day to day
without focus or direction.
60 Achieving Service Excellence
I NTERNAL ASSESSMENT
An organization cannot create a strategy until it discovers its weaknesses (e.g., unde-
veloped potential, lack of resources) and identies its strengths (e.g., core competen-
cies, competitive advantages). By conducting an internal assessment, the organization
will identify the areas that need to be improved, eliminated, or capitalized on.
Core Competencies
In Competing for the Future, authors Gary Hamel and C. K. Prahalad (1994, 221
22) defne core competencies as follows:
Core competencies are the collective learning in the organisation, especially
how to co-ordinate diverse production skills and integrate multiple streams of
technologies.... Core competence is communication, involvement and a deep
commitment to working across organisational boundaries.... Core competence
does not diminish with use. Unlike physical assets, which do deteriorate over
time, competencies are enhanced as they are applied and shared.
Simply, an organizations competencies are what it does well (through its strategy,
staff, and systems) and how it sets itself apart from the competition. For example,
HealthSouths core competence revolves around physical rehabilitation of people who
have undergone surgery or suffered injuries. Some healthcare organizations develop
core competencies to help dene performance expectations to achieve.... goals and
objectives, as is the case with Washington State Hospital Association (WSHA 2009).
WSHAs competencies include a service commitment to its member hospitals, ability
to deliver results, personal integrity, and cultural competency (WSHA 2009).
Core competencies should be embodied in the organizations mission statement
(see, for example, Exhibit 3.2). Understanding what it does (or strives to do) en-
ables the organization to know what it should not do. When an organization strays
from its established core competence, it exposes its weaknesses to competitors. For
example, in the late 1980s and into the 1990s, many health systems invested in
physician practices, real estate, health insurance companies, laundry and cleaning
services, and other businesses in an effort to diversify and grow. Most of these new
ventures failed primarily because the health systems, although capable in deliver-
ing inpatient care, were not equipped to manage an expanded business model that
included noncore businesses. The problem was not expansion per se; the problem
was expanding into areas beyond core competencies.
Chapter 3: Enhancing Customer Service Through Planning 61
An internal assessment will also inform the organization of competencies it does
not currently possess, but which would allow it to take advantage of opportunities
in the marketplace. For example, a surgery clinic learns that it does not have the
capability of handling elective surgery, but the external environmental analysis re-
veals that, in the foreseeable future, the aging of the population will create a robust
market for elective surgery. Based on this evaluation, the clinic should develop the
capability for performing elective surgery as an added core competence.
Managerial Competencies
A factory manager and a hospital manager may have many of the same managerial
skills, but the two professionals are not likely to be successful if they switch jobs.
Each industry requires its leaders and managers to have competencies that enable
them to handle the unique issues encountered in that industry. In healthcare, many
managerial competency models have been developed by various professional asso-
ciations and partnerships, such as The Healthcare Leadership Alliance (HLA). The
HLAs model is comprehensive and evidence-based, emphasizing fve domains that
are relevant in healthcare management practice (Stef 2008, 364):
1. Communication and relationship management
2. Leadership
3. Professionalism
4. Knowledge of the healthcare environment
5. Business skills and knowledge
Other than knowledge of the healthcare environment, the HLA competencies are
not exclusive to healthcare. These competencies are necessary in all other industries. In
healthcare, a leader or manager must be able to apply these competencies to the unique
internal and external environments of the organization. As Stef argues, todays health-
care executives and leaders must have management talent sophisticated enough to match
the increased complexity of the healthcare environment. We cannot agree more.
Assets
Internal assets help defne the organizations core competencies. These assets in-
clude reputation; human capital (employees); managerial capabilities; resources;
and competitive advantage brought on by the organizations technology, patent,
brand, and customer loyalty. For example, Baptist Health Care in Pensacola, Flor-
ida, reported a $2.6 million savings and improved patient outcomes as a result of
62 Achieving Service Excellence
installing a hospitalist program (Free Library 2004). Undoubtedly, the decision to
start a hospitalist program followed an evaluation of internal assets. Back in 1997,
Baptist embarked on a turnaround journey, seeking to develop programs and
strategies that promote patient satisfaction, employee empowerment, and physi-
cian support (Nathan 2000). In 2007, Baptist was selected by Fortune as one of
the 100 Best Companies to Work For, a recognition that has been bestowed on
the organization repeatedly (Baptist Health Care 2009). All of these assets allow
Baptist to deliver its core competency of customer service excellence.
VI SI ON AND MI SSI ON STATEMENTS
Most organizations spend a great deal of time formulating their vision and mission
statements, and for good reason: If you do not know what you want to do (vision), you
cannot know how you will do it (mission). Vision and mission statements vary from
the simple to the complex, and the simpler the better. Exhibit 3.2 provides examples of
vision and mission statements of top-ranked healthcare organizations.
To a certain extent, vision and mission statements contain overlapping goals,
and sometimes the terms are used interchangeably. However, these concepts have
distinct purposes. While the vision represents an overarching goal, the mission
identifes the principles behind that goal. For example, a customer-focused mission
states who the customers are, what customers need, and how the organization can
meet those needs. Simply, the mission expresses how the organization achieves its
vision (Pearce and Robinson 2005).
Vision
The vision articulates the organizations aspirations or ideal state in the future.
Hamel and Prahalad (1994) refer to the process of achieving the vision as the
quest for industry foresight, wherein the organization is doing everything pos-
sible today to gain a deep understanding of the trends and opportunities to be able
to lead in tomorrows marketplace. Simply, visioning is the task of visualizing what
does not yet exist (Hamel and Prahalad 1994).
According to Hamel and Prahalad (1994, 22122), a vision statement should
have the following traits:
1. Imaginable: paints a picture of the future
2. Desirable: appeals to all stakeholders
Chapter 3: Enhancing Customer Service Through Planning 63
Exhibit 3.2 Example of Mission and Vision Statements
Waynesboro Hospital (Waynesboro, Pennsylvania)
Mission: The mission of Waynesboro Hospital is to provide quality health care to, and improve
the health and well-being of, the people of the Hospitals service area. We will strive to offer these
services at a cost that provides the greatest value to the community.
Vision: Waynesboro Hospital will be the dominant force for promoting healthy communities
by serving as the provider of choice in our area for hospital sponsored care and by leading the
coordination of high quality individual and community health services.
Values: We believe that the delivery of quality health care can best be achieved by caring for both
our community and coworkers with the regard for the dignity of the individual that we would
wish for ourselves.
Kings Daughters Medical Center (Ashland, Kentucky)
Mission: To Care. To Serve. To Heal.
Vision: World-Class Care In Our Communities
Baptist Health South Florida (Coral Gables, Florida)
Mission: The mission of Baptist Health is to improve the health and well-being of individuals,
and to promote the sanctity and preservation of life, in the communities we serve.
Vision: Baptist Health will be the preeminent healthcare provider in the communities we serve,
the organization that people instinctively turn to for their healthcare needs. Baptist Health will
offer a broad range of clinical services that are evidence-based and compassionately provided
to assure patient safety, superior clinical outcomes and the highest levels of satisfaction. Baptist
Health will be a national and international leader in healthcare innovation.
Indiana Regional Medical Center (Indiana, Pennsylvania)
Mission: Indiana Regional Medical Center, in partnership with its communities, strives to be the
center for quality, accessible, cost-effective healthcare. We are dedicated to promoting health and
wellness through education and compassionate, caring services.
Vision: To be the best community hospital in Pennsylvania.
Values: We value people, health and exceptional performance.
Source: This information was retrieved from the organizations websites.
64 Achieving Service Excellence
3. Feasible: is realistic and attainable
4. Focused: provides clear guidance
5. Flexible: allows individual adaptations
6. Communicable: can be explained in fve minutes
For the vision to gain stakeholder support and following, it must be clear and
well communicated. In addition, it must incorporate organizational values (Mittal
2009), which in turn defne the corporate culture (Atchison and Carlson 2009).
Sometimes an organization is created to fulfll a personal vision, as former Chilis
CEO Norman Brinker has said: I have a vision, then I create an atmosphere that
involves the people in that vision (Brinker and Phillips 1996, 191).
Mission
The mission statement denes three organizational truths:
1. Why it exists
2. What it does and how
3. Who it serves
The mission guides leaders and managers in developing strategies, allocating
resources, creating initiatives, and establishing employee standards for dealing with
patients and other customers. In this sense, the mission represents the organiza-
tions core values.
Customer service is almost always an integral part of a mission statement.
When Southwest Airlines began operating in 1971, its customer-focused message
to employees was, Get your passengers to their destinations when they want to get
there, on time, at the lowest possible fares, and make darn sure they have a good
time doing it. Today, Southwests mission has stayed the same: Dedicated to the
highest quality of Customer Service delivered with a sense of warmth, friendliness,
individual pride, and Company Spirit. Also, Southwest is committed to provid-
ing Employees a stable work environment with equal opportunity for learning and
personal growth (Gittell 2003).
Results of one study of hospital mission statements are presented here to illus-
trate the link between mission and customer orientation. The study found that
the components most common among missions were purpose (76 percent), spe-
cifc customers served (62 percent), one clear compelling goal (56 percent), val-
ues and beliefs (56 percent), products and services offered (52 percent), concern
Chapter 3: Enhancing Customer Service Through Planning 65
with satisfying customers (50 percent), and concern for employees (41 percent)
(Barr 1999). In addition, the survey also found that top management satisfac-
tion with nancial performance was signicantly and positively correlated with
a mission statement that contains three types of information: customers served,
concern with satisfying customers, and products/services offered. Moreover, top
management satisfaction with nancial performance was also higher if manage-
ment was satised with how well each of the following mission statement com-
ponents was written: specic customers served, concern with satisfying custom-
ers, and concern for employees.
Once the mission has been established and communicated to all stakeholders,
it should be used as a guide for all internal and external initiatives. In this way, the
organization (including its governance board) and the community at large are as-
sured that every activity, practice, and policy is aligned with the mission.
THE SERVI CE STRATEGY
The service strategy is the detailed plan for meeting and exceeding the cus-
tomers expectations of a healthcare experience. The service strategy should be
based on informed judgment and should involve structured studies (environ-
mental assessment) and consumer surveys. Led by the mission and vision, the
service strategy guides the development of the service product, service setting,
and service delivery system. That is, based on the why, what, and who defined
in the mission, the organization can craft the service product, its setting, and
its delivery system. For example, if the mission is to provide elective cosmetic
surgery to an upscale, educated group in a specific geographic area, then the
strategy should be to provide high-touch and high-tech services in an elegant
environment.
The needs, opinions, preferences, and expectations of the targeted consumer
group should be incorporated into the service strategy. Assessing the external and
internal environment is not enough to gain insight into the key drivers of customer
satisfaction. The organization must also ask its customers. Only customers can
voice what they really think about the quality and value of a product or the role the
organizations core competencies play in service delivery.
As discussed in Chapter 2, The Walt Disney Company surveys its guests constantly.
On one such survey, the company asked guests at Disney World to rate their experiences
with various aspects of their visit in relation to their intention to return and their overall
satisfaction (Lee 2004). The fast food and transportation system received low ratings;
however, analysis of the data revealed only a weak statistical relationship between the
66 Achieving Service Excellence
low ratings and the customers intention to return and overall satisfaction. In other
words, the customer-perceived quality of the food and the transportation did not
matter much in determining return visits. After all, people do not y from across
the world to eat or ride basic transport.
What did matter (key drivers) to customers were the hours of operation, em-
ployee friendliness, and the reworks display. Ratings in these two areas were
strongly correlated to both intention to return and overall satisfaction. As a re-
sponse to these survey ndings, Disney invested available funds in extending park
hours, hiring friendly employees, and expanding the reworks displays. Disney
made an improvement decision based on information provided by its guests: It
allocated its scarce resources to enhancing the services that were perceived most
valuable by its customers and that were the key drivers of their behavior and at-
titudes toward the Disney experience. Healthcare organizations can learn a lot by
identifying its patients key drivers and, like Disney, by making decisions based on
what the patients declare as important.
Service expert Len Berry (1999, 6568) suggests that an excellent service strategy
commits the organization to four key factors: quality, value, service, and achieve-
ment. Press (2003) found that three key drivers were correlated with overall patient
satisfaction based on data derived from 992,000 outpatients at 516 outpatient fa-
cilities in 2001: Staff sensitivity to your needs, How well staff worked together
to provide care, and Response to concerns/complaints made during your visit.
Quality and Value
An excellent service strategy emphasizes quality and value. A healthcare organization
truly committed to customer service will make a commitment to providing both high
quality and high value. A commitment means that the organization invests the neces-
sary resources (money, time, and labor) to identify and measure patients perception of
quality and value. It is perception that matters in determining quality and value and
not the actual cost or engineered quality. Patients must perceive that the total healthcare
experience was worth the pricethat is, offered a good value.
Previous research has shown that many healthcare managers do not know what re-
ally matters to patients (Duffy, Duffy, and Kilbourne 2001). The main reason for this
gap in knowledge is that, typically, managers do not ask patients, preferring instead to
assume they know what patients think. Quint Studer (2008, 27072) recommends
an easy method for nding out and remembering customer needs, wants, and expec-
tations: A manager lls out a preference card for customers (patients and physicians)
Chapter 3: Enhancing Customer Service Through Planning 67
on the unit. The patient preference card may include personal information such
as favorite foods, sleeping habits, and a visitor list. The physician preference card
may include professional requests such as the appropriate time to call the physician
about a patients condition. These convenient cards allow managers to customize
the service product, setting, and delivery, which increases the customers percep-
tion of quality and value.
Service and Achievement
An excellent strategy must emphasize service and achievement of goals, not just
quality and value. Again, organizational commitment to service excellence, not just
lip service through the mission statement, is imperative. Commitment to service
(and, by extension, achievement of service goals) requires the following:
Recruitment and retention of physicians and employees who believe in the
merits and efcacy of customer service
Allocation of appropriate resources to employee-training programs, service
product development and evaluation, and service performance and reward
systems, among others
Action plans that support the service mission
Regular and clear communication about service initiatives to all stakeholders
A culture of service can foster a sense of genuine achievement among employ-
ees and clinicians. It can stretch peoples service abilities and, in so doing, expand
the capabilities of the entire organization, resulting in performance that exceeds
everyones expectations. At one time, 90 percent of Taco Bell restaurants operated
properly without full-time managers (Berry 1999). That is an impressive scenario
that is possible when people are committed to service and achievement of service
goals.
ACTI ON PLANS
Action plans lay out the specic tactics of the service strategythat is, how the or-
ganization will operate, what each department or employee group will be expected
to do, and what time frame will be followed. (Exhibit 3.3 shows how a service
strategy can be converted into action plans.)
68 Achieving Service Excellence
Action plans should be established in ve key areas:
1. Management performance
2. Staffng (hiring, training, retention)
3. Capacity utilization
4. Finance/budget
5. Marketing
Performance criteria in each of these areas must be established and measured.
Measurement ensures that the right steps are taken, the right people are involved,
the right time line is followed, and the right goals are pursued. More important,
Exhibit 3.3 From Service Strategy to Action Plans
Service Strategy
Study similar organizations that excel in customer service and benchmark against them.
Use a service audit to survey customers based on quality, value, service, and achievement.
Develop a strategy to reduce the gaps between desired and actual customer service
expectations.
Action Plans
Use cross-functional teams to create tactical plans that focus all parts of the organization on
customer service.
Use cross-functional teams to integrate all of the tactical plans.
Use various techniques, such as brainstorming, to create customer service initiatives in each
tactical area.
Carefully select one or two customer service priority areas for intense focus.
Empower employees to meet customer expectations.
Include customer outcome measures in assessment strategies.
Ensure that key stakeholders support new strategic customer service initiatives through
continued communication of benets of change and risk of the status quo.
Involve staff in identifying ways to implement strategy.
Use social norms and opinion leaders to create support for strategic initiatives.
Audit the alignment of customer service plans with mission, vision, values, strategies, staffng,
and systems.
Chapter 3: Enhancing Customer Service Through Planning 69
measurement allows the stakeholders to see their progress and contributions to-
ward the overarching strategy.
The action plan in each area must be created with careful consideration of the
action plans in other areas. For example, when establishing the marketing plan, the
capacity utilization plan must be consulted to prevent conicts in priorities. What
if the marketing plan is designed to draw thousands of new patients to the hospital
but the capacity plan is intended to drastically reduce services on the weekends?
Similarly, what if the management performance plan demands managerial innova-
tion but the nance plan provides no budget for accomplishing this innovation
goal? Action plans need to integrate the activities of the organization. Action plans
make little sense if they are not supported by other organizational components or
if no money has been allocated to execute the activities.
Action plans provide a road map and put the responsibility for achieving the
service strategy into the hands of employees (managers and frontline staff alike). In
this sense, everyone knows how his contribution helps the organization reach its
mission, and everyone is held accountable for meeting and exceeding patient ex-
pectations. The most obvious and the biggest opportunity for delivering customer
satisfaction is direct patient contact. Exhibit 3.4 lists the ideal behaviors to display
during service delivery, while Exhibit 3.5 recommends protocols (what you do)
and scripts (what you say) for selected drivers of patient satisfaction.
THE ALI GNMENT AUDI T
Strategy scholar Michael Porter (1996) suggests that the best way for an organiza-
tion to achieve a sustainable competitive advantage is to reinforce its strategic plan
by aligning functional policies, stafng decisions, structure, and all other activities
with the established mission. In addition, Nadler and Tushman (1997, 34) argue
that The degree to which the strategy, work, people, structure, and culture are
smoothly aligned will determine the organizations ability to compete and suc-
ceed. Quint Studer (2008) organizes an entire book around the benefts of align-
ment.
Empirical research has found that when internal organizational factors (i.e.,
mission, vision, values, and communication methods) are aligned with the stra-
tegic plan, employees feel higher levels of commitment and satisfaction (Ford et
al. 2006). In turn, staff commitment and satisfaction lead to positive fnancial
returns, competitive advantage, and customer satisfaction (Atkins, Marshall, and
Javalgi 1996; Fottler et al. 2006; Schneider, White, and Paul 1998). A study by
70 Achieving Service Excellence
Exhibit 3.4 Employee Behaviors That Deliver Patient Satisfaction
1. Make people feel welcomed. Smile, make eye contact, introduce yourself, use customer last
names, and offer help.
2. Protect privacy and confdentiality. Knock before entering patient rooms, cover patients, and
watch what you say to whom.
3. Show courtesy and respect. Say please and thank you, be sensitive to cultural differences,
and nd out what customers want and need.
4. Explain what you are doing. Let customers know what to expect, speak in ways customers
can understand, check to see if the message is understood, and keep the staff informed.
5. Handle with care. Slow down and handle patients gently when moving or touching them,
and listen and respond to what they are saying.
6. Maintain a customer-friendly atmosphere. Reduce noise and keep the environment clean and
clutter-free.
7. Follow-up and follow through. Work to solve problems and complaints, let customers know
what you can and cannot do, and fnd out who can help and then follow-up and close the
loop.
Source: Used with permission from Journal of Healthcare Management 46 (3): 153. (Chicago: Health
Administration Press, 2001).
Exhibit 3.5 Protocols and Scripts for Key Drivers of Patient Satisfaction
Key Driver
Protocol
(What you do)
Script
(What you say)
1. Respect for privacy and
dignity
Knock on patients door and
say patients name
Mrs. ____? My name is ____.
I am here to _________. Is this
a good time?
2. Feel listened to Ask if patient has any special
needs or requests
Is there anything else I can do
for you?
3. Experience responsiveness
to concerns and complaints
Ask if the previous concern
(e.g., low room temperature)
has been resolved
Is the room temperature still
uncomfortable? Can I get you
another blanket?
Source: Adapted with permission from Journal of Healthcare Management 46 (3): 154. (Chicago: Health
Administration Press, 2001).
Chapter 3: Enhancing Customer Service Through Planning 71
Goldstein and Schweikhardt (2002) reveals that organizations that focus on the 19
dimensions of the Malcolm Baldrige National Quality Award provide high levels of
customer service and satisfaction. This fnding rings true for Sharp HealthCare (see
sidebar), a recipient of the Baldrige Award and a proponent for aligning mission
with all organizational components and activities.
Although healthcare organizations routinely audit their nancial plans and op-
erations, they are doing so to monitor nancial progress, not to check if the plans
are consistent with the mission; plus, most organizations do not audit their patient
services and management processes. In light of the advantages that an alignment
brings, an organization should conduct an alignment audit to ensure that all of its
undertakings are in sync with its mission (Crotts, Dickson, and Ford 2005). Such
an audit (Exhibit 3.6) may be conducted annually, much like a nancial audit is
performed.
If what gets measured gets managed, then measuring alignment will guaran-
tee that the mission is managed (Laborwitz 2005). More important, conducting
an audit communicates a powerful message: The organization is serious about its
service mission.
Cues
Managers communicate organizational needs, wants, and expectations to employ-
ees by sending various cues. Cues can be explicit (such as the written mission state-
ment) or implicit (such as a verbal story about an exemplary employee). Human
resource policies (such as requirements in a job description or system procedures
for handling customer calls) also serve as cues. From these cues, employees learn
what the organization (and their superiors) deems important and desirable regard-
ing employee performance and behavior.
When cues are aligned with the mission, they send a message that the mission
is more than just a theory; it is applicable to everyday practice. An alignment audit
systematically measures how well each cue supports the mission. Because align-
ing each cue with the mission does not by itself achieve mission excellence, an
alignment audit reveals whether all cues (verbal, written, behavioral) are sending a
consistent message.
For example, when managers say customer service is important, do they reward
those who go above and beyond their duties to please customers, or are reward pro-
grams in place to recognize an employees customer orientation? Similarly, when a
mission statement claims that the organization is a leader in medical innovation,
do top executives strive to recruit and retain staff who have expertise, experience,
72 Achieving Service Excellence
SIDEBAR: SHARP HEALTHCARE
In 2007, Sharp HealthCare, the largest inte-
grated delivery system in San Diego, California,
received the Malcolm Baldrige National Quality
Award.
Sharps quality journey began in 2001 with
the launch of the Sharp Experience, a perfor-
mance improvement initiative aimed at making
the organization the best place to work, the best
place to practice medicine, and the best place to
receive care. Guided by its mission, vision, and
values, Sharp conducts a strategic planning pro-
cess with an eye toward the satisfaction of pa-
tients, staff, physicians, employees, third-party
payers, and community representatives (Sharp
HealthCare 2007). Moreover, Sharp reinforces
its mission, vision, and values by constantly
communicating them to stakeholders. In addi-
tion, Sharp pursues (and then measures) a wide
range of short- and long-term objectives that in-
crease customer satisfaction, customer loyalty,
and market share. Everything at Sharpfrom
strategic plans to meeting agendasis aligned
with the Six Pillars of Excellence, which are the
foundation for its vision to transform the health
care experience (Sharp HealthCare 2009). Fol-
lowing are the award-winning principles behind
Sharp HealthCares success.
MISSION STATEMENT
To improve the health of those we serve with
a commitment to excellence in all we do. Of-
fer quality care and service that set community
standards, exceed patients expectations, and
are provided in a caring, convenient, cost effec-
tive, and accessible manner.
VISION STATEMENT
Redene the healthcare experience through a
culture of caring quality, service, innovation,
and excellence. Recognition as the best place
to work, practice medicine and receive care . . .
become the best healthcare system in the
universe.
VALUES
Integrity
Caring
Innovation
Excellence
SIX PILLARS OF EXCELLENCE
1. Quality
2. Service
3. People
4. Finance
5. Growth
6. Community
EMPLOYEE BEHAVIOR STANDARDS
Condentiality; Manners; Diversity; Skills and
competence; Lasting impression; Talk, Listen,
and Teamwork; Service recovery; Safety; Appear-
ance; Ease waiting times; Smile; Take people
to destination; Scripting; Attitude of gratitude;
Round with reason; Acknowledge; Introduce
yourself; Explain; Thank you
CRITICAL SUCCESS FACTORS
Defne, measure, and communicate climate
and service excellence
Increase patient and community loyalty
Attract, motivate, maintain, and promote
the best healthcare workforce in the area
COMMUNICATION PLAN
Use multiple communication processes to con-
vey vision, values, and goals annually (all staff
assembly, employee satisfaction survey, and
physician satisfaction survey), quarterly (leader
development seminar and employee forums),
monthly (departmental meetings, action teams,
operations meetings, board meetings, and
newsletters), and day-to-day (CEO letters, global
emails, intranet, and thank you notes).
PLANNING HORIZONS
Long-term (fve years)
Short-term (one year)
Chapter 3: Enhancing Customer Service Through Planning 73
SIDEBAR: SHARP HEALTHCARE (continued)
Long-Term Service Strategies (20072012)
Focus on top patient satisfers (key drivers)
as identied by Press Ganey Patient Surveys
Hospitals, medical groups, and physician
satisfaction
Physician leadership development and
satisfaction
Extensive education and tools for leaders
and staff
CUSTOMER/PARTNER-DRIVEN
ENVIRONMENTAL ANALYSIS
During the strategic planning process, a cus-
tomer-partner driven analysis is produced. Sharp
continually assesses key customer groups, com-
petitor activities, market share, demographic
data, customer group feedback, and industry
trends data.
CUSTOMER SERVICE METRICS
Patient satisfaction surveys (Press Ganey);
Physician and staff satisfaction surveys; Focus
groups; Mystery shopping; Interviews; Encoun-
ter data online; Nurse connector web center; Call
center; Rounding with Reason logs; Comment
cards; Interdepartmental surveys; Complaint
system; Health plan surveys; Customer contact
centers; Web page; and Annual meeting for pay-
ers and medical groups.
Source: Reprinted with permission from Sharp
HealthCare, San Diego, California.
and training in advanced clinical technology? In other words, an alignment audit
enables managers to discover the inconsistencies between their words and actions.
Managements hope that physicians and employees do what they are told is folly
if management does not behave in accordance to its own cues or offer rewards to
those who abide by those cues.
Well-aligned cues guide internal stakeholders (managers, employees, and clini-
cians alike) performance and behavior in every patient or customer encounter.
Framework
The deeper the audit delves into the organizations policies, procedures, and prac-
tices, the more likely the audit will reveal misalignment, but the greater the op-
portunity for improvement will be. In this section, we discuss the framework of an
alignment audit.
Core Elements
The audit should focus on three main areas: (1) strategic and tactical practices, (2)
stafng policies and processes, and (3) system procedures and design. Using other
categories of focus may be equally useful, but these three areas comprehensively
74 Achieving Service Excellence
address the elements most critical to organizational functions. Exhibit 3.6 presents
sample audit questions for each core element that may be used as a starting point or
a template for an alignment audit. Managers may expand or revise these questions
according to their organizational needs or preferred areas of focus.
Steps for Conducting an Audit
The audit should be structured as follows:
1. Dene the goals of the mission in measurable terms (e.g., scores on customer
satisfaction surveys).
2. Identify key policies, procedures, practices, and communications that cue
employee performance and behavior (e.g., job descriptions).
3. Formulate questions that evaluate if the mission is reected in each key policy,
procedure, practice, and communication (e.g., see Exhibit 3.6)
4. Answer the questions honestly.
5. Develop a list of misaligned items for immediate or future corrections and
improvements.
6. Compare the audit results (step 5) with the mission goals (step 1).
The purpose of step 6 is to audit the auditthat is, to afrm that the items
audited are the ones that matter according to the mission goals or outcomes de-
sired. In addition, step 6 establishes a measure of the organizational benet gained
by undertaking an alignment auditthat is, the gap between the desired versus
the actual behavior is determined. Lastly, step 6 documents the alignment process,
which serves as proof that the organization has put in effort toward alignment.
Research by Caldwell and colleagues (2008) indicates that successful implemen-
tation of strategies (step 6) requires a change in employee behavior. Changing that
behavior calls not only for the relentless communication of customer needs and
expectations but also for the involvement of staff in identifying the action steps.
CONCLUSI ON
Healthcare service planning lays out the necessary path and identies the mile-
posts that the organization must follow to fulll its mission, to achieve its vision,
and to serve its customers. Whether the organization is a large medical complex,
a managed care company, or a physicians offce, it can lose its competitive stature
if it foresees the wrong future, misdiagnoses its core competencies, poorly denes
its mission, or chooses the wrong service strategy. Of course, unforeseen develop-
ments may disrupt or overturn even the best-laid plans.
Chapter 3: Enhancing Customer Service Through Planning 75
Exhibit 3.6 Mission Alignment Elements with Audit Questions
Strategic and Tactical Practices
1. Departmental goals are aligned with mission.
Does management specifcally reward unit/department managers on how well they score on
mission related measures?
Does management specifcally reward managers on how well their unit/department provides
excellent service to other units/departments?
2. Environmental setting and physical design communicate mission.
Is our physical facility/room layout designed to communicate our mission?
Are our temperature, lighting, and environmental conditions designed to be customer friendly?
3. Stories relate and successes celebrate excellence in mission achievement.
Does management formally celebrate the performance of employees who help achieve mission
objectives?
Is the achievement of mission outcomes formally recognized and rewarded in our reward system?
4. Top management walks the mission talk.
Does management shows its commitment to our mission by visibly walking the mission talk?
5. Performance standards are aligned with mission.
Is achievement of mission outcomes incorporated in each manager/supervisors annual plan/
goals/objectives?
Has management established standards of service quality for all aspects of the achievement of
mission outcomes that are important to our customers and us?
6. Budget allocations are aligned with mission.
Do our departmental/unit supervisors have the fnancial resources to train employees how to
achieve mission outcomes?
Are employees reminded that achievement of all mission outcomes is no less important than
achievement of nancial goals?
Stafng Policies and Processes Factors
7. Job descriptions include mission.
Does every key job description include responsibility for achievement of mission outcomes?
8. Job ads include mission.
Does our recruitment literature mention our commitment to achievement of mission outcomes?
9. Interviews include questions about commitment to mission.
Do we routinely ask applicants about their commitment to achieve mission outcomes in
employment interviews?
Do we use commitment to our mission as a criterion in selecting who we hire?
continued
76 Achieving Service Excellence
Exhibit 3.6 Mission Alignment Elements with Audit Questions (continued)
10. Orientation programs emphasize mission.
Do we routinely explain our commitment to mission achievement in our orientation of new
employees?
11. Performance appraisals include and reward mission.
Is commitment to achievement of mission outcomes part of everyones annual performance
evaluation?
Can specifc failures in achievement of mission outcomes lead to employee discipline including
discharge?
12. Training programs include retraining in mission.
Does management routinely schedule time to remind staff members of their commitment to
achievement of mission outcomes in regular staff meetings?
System Procedures and Design Factors
13. Mission achievement elements are systematically measured.
Do we follow a set plan for consistently collecting information about achievement of mission
outcomes?
Do we follow a set plan to consistently fx customer service problems that interfere with
achievement of mission outcomes?
14. Measurement of mission outcome achievement is systematically provided to all.
Do we follow a set plan to consistently share feedback about achievement of mission outcomes
with our employees?
Are unit/department comparisons of achievement of mission outcomes performance scores
systematically measured and publicly shared across units/departments?
15. Service quality systematically measured.
Do we consistently measure the degree to which our service experience meets or exceeds our
customers quality expectations for reliability, responsiveness, expressions of empathy, and the
tangibles of the destination?
16. Service delivery system design reects mission.
Do we follow a set plan to consistently record how long customers wait for service?
Do we follow a set plan to consistently keep our customers informed about all aspects of their
experience?
Source: Reprinted with permission from Crotts, J., D. Dickson, and R. C. Ford. 2005. Aligning Organizational
Processes with Mission: The Case of Service Excellence. The Academy of Management Executive 19 (3): 57.
Chapter 3: Enhancing Customer Service Through Planning 77
Good plans (strategic, service, and others) attempt to bring rationality and sta-
bility to an organizations operations and efforts, despite the unpredictability of gov-
ernments, the market, the economy, technology, customers, and the future. Thus,
managers should not ignore the trends and changes in the marketplace, which may
render any plan irrelevant and noncompetitive. The process of planning should be
tied to a yearly calendar and placed on everyones time-management screen.
Note that plans laid out in August may be turned upside down by September
because of external events such as competitors innovations; new laws and regula-
tions; technological developments; changes in customer preferences; organizational
disruptions such as the illness or death of a CEO, a massive lawsuit, or a labor
strike; or societal upheavals such as an economic recession, a natural disaster, or a
terrorist attack. In the face of such events, plans have to be revised immediately.
In this sense, plans must be designed to be exible, allowing the organization to
respond to any unforeseen variables. Many organizations create contingency plans
or alternative strategies because the future is unpredictable.
Increasingly, organizations are involving frontline employees in the planning
process for several reasons. First, employees know more than anyone else about the
key drivers of patient satisfaction (Fottler et al. 2006), and as such they have heard
and thought about many ideas about products or services that could be added,
redesigned, or eliminated in an effort to increase customer satisfaction and percep-
tions of quality and value as well as to reduce costs. Second, smooth implementa-
tion of any plan necessitates gaining employee buy-in. Employees will resist the
plan if they do not understand the logic and reasoning behind it. The organization
must make every effort to communicate and educate all internal stakeholders about
its strategies. If employees are aware of how important the plan is to achieving a
mission they believe in, they are more likely to support it and work hard toward its
achievement. The more they know about how the plan affects their daily work and
functioning, the more apt they are to offer support and help the implementation.
Service Strategies
1. Engage in service strategy planning to design a customer-focused product,
setting, and delivery system.
2. Base all plans and subsequent activities on the vision, mission, and values of
the organization.
78 Achieving Service Excellence
3. Use appropriate tools to forecast future needs and demands, but do not let
them replace managerial judgment.
4. Perform an internal and external environmental assessment to discover
strengths, weaknesses, opportunities, and threats. Core competencies,
internal assets, and market trends are just some of the many products of
such an assessment.
5. Consider the customers perception of quality and value when creating a
service or product and establishing the setting and delivery system.
6. Develop action plans to implement the service strategy, and communicate
those plans to all internal stakeholders.
7. Conduct an alignment audit to ensure that all critical activities are in
sync with the mission and that written cues are consistent with verbal and
behavioral cues.
8. Involve employees in the planning process to gain buy-in and ensure a
smooth plan implementation.
79
The hospital, grey, quiet, old,
Where Life and Death like friendly chafferers meet.
William Ernest Henley
C H A P T E R 4
Creating a Healing Environment
Service Principle:
Exceed customer expectations regarding the healthcare setting
in both reception and patient care areas
In a consumer-driven, experience economy, a healthcare service is no longer
just an economic transaction. Patients and their families expect more, including
comfort, convenience, safety, information, and even entertainment in the physical
setting in which the service is delivered. As such, the environment or setting is not
merely a background to the service experience; it is an important contributor to
patients well-being, mood and attitude, and perception of value and quality. The
physical settingincluding layout, dcor and furnishing, lighting, signage, odor,
and cleanlinessis part of the total healthcare experience.
Any providerfrom a 500-bed university hospital to a small rural clinic
should create an environment that enhances and complements the total healthcare
experience, although each providers approach will differ depending on its available
space, capabilities, resources, and customers expectations.
For example, a state-of-the-art medical complex may communicate its commit-
ment to patient care and satisfaction through its sprawling size, modern architec-
ture, wide use of advanced technology, and carefully laid-out public and private
areas. A small rural clinic, on the other hand, may convey the same message, but
through colorful and fragrant plants and owers in and around the facility; clean,
well-lit, and functional spaces; a prominently placed registration/information desk;
and pleasing artwork in rooms and hallways.
In other words, the physical environment is a tool for adding value to the ex-
perience. A clean, safe, well-appointed, and attractive setting alleviates the stress of
the healthcare service for patients, families, and staff.
80 Achieving Service Excellence
In its landmark report, Crossing the Quality Chasm, the Institute of Medicine
(2001) identifes several problems with the U.S. healthcare system: It is unsafe, in-
effective, ineffcient, untimely, inequitable, and lacking patient-centeredness. Since
publication of that report, a patient-safety-and-quality revolution has swept the
country, leading to numerous initiatives and research. Even before the IOM report,
however, studies were underway regarding the effects of the physical healthcare
space on various areas, including quality, delivery, and stress and fatigue of both
patients and staff (Geboy 2007). And studies have contined: Sadler, DuBose, and
Zimring (2008), for example, found that the environment may unintentionally
contribute to negative outcomes, such as those listed in the IOM report.
In this chapter, we address the following:
The many dimensions of the service setting, including its importance to the
healthcare experience and its effects on the healing process
Evidence-based design
Healing environment
Environmental trends and strategies that engender customer loyalty
Four environmental dimensions
Servicescape
Throughout the chapter, we provide examples of healthcare organizations that
have enhanced their environments to achieve better outcomes.
THE I MPORTANCE OF THE SERVI CE SETTI NG
In healthcare, the service setting serves multiple purposes. First, it is the stage on
which the organizations staff can please or disappoint its customers. Second, it
creates and conveys a tacit message about the organization. For example, if clean
and orderly, the organization is saying that it cares about safety and quality; if di-
lapidated, the organization is communicating that it is in serious nancial trouble
and hence cannot appropriately provide care. Third, it is viewed as part of the
experience, especially when coordinated with the service product. For example,
a well-tended garden on the cancer centers grounds sends a message about the
healing services provided inside. Fourth, it adds to or takes away value from other
clinical functions.
Simply, the setting inuences patient satisfaction, intention to return, willing-
ness to recommend to others, and even the rate of healing. Research supports this
argument: One study indicates that an appealing hospital room leads to positive
Chapter 4: Creating a Healing Environment 81
patient evaluations of doctors, nurses, and the overall service experience (Swan,
Richardson, and Hutton 2003). Furthermore, a patient can form judgments and
expectations about a healthcare organizations capability and service quality the
rst time he or she sees the facility and even before he or she receives any medical
intervention. Thus, the organization should take care to ensure that the environ-
ment makes an outstanding, positive rst impression.
Perception is almost always more important than reality. That is, even if the
quality of care at an old hospital is equal to or comparable with that provided at
a modern facility, the perception (among patients and employees alike) is that the
old hospital provides substandard care. For example, before undertaking a signi-
cant renovation, a public teaching hospital in Atlanta, Georgia, had a poor public
image despite the fact it consistently provided high-quality healthcare. After the
renovation and improvements, the hospitals reputation soared, even though its
service quality remained about the same (Fottler et al. 2000).
Previous Mind-Set
In the past, most healthcare organizations focused their efforts almost exclusively
on the medical needs of patients. As patient satisfaction surveys became more
widely used in the 1990s, however, organizations began to learn that patients and
their families considered the service environment more important than was previ-
ously understood. Findings from research, surveys, and focus groups indicated the
following:
Members of a hospital focus group stated that physical features, more than
any other service attributes, are a determinant of their satisfaction and
perception of service quality (Singh 1990).
Patients want privacy, cleanliness, quiet, closet space, and the ability to control
temperature (Malloch 1999).
Environments at most facilities fail to meet patient expectations (Lawson and
Phiri 2000).
One hospitals physical appearance was rated at the bottom of all service
attributes, leading some patients to switch healthcare providers (Bowers,
Swan, and Koehler 1994).
The healthcare setting is a major determinant of perceived quality and
customer satisfaction and can lead to sustainable competitive advantage
(Taylor 1994).
82 Achieving Service Excellence
Atmospherics or environmental factors have been shown to lead to customer
satisfaction, continued patronage, positive word-of-mouth advertising, and an
improved image for the organization (Bitner, Booms, and Staneld Tetreault 1990).
More recently, a focus group of patients revealed the following environmental
factors as important determinants of their perceptions of quality of care (Gupta
2008):
Modern, state-of-the-art equipment
Comfortable, clean, and visually appealing facilities
Neatly and appropriately dressed physicians and staff
Convenient location
Good housekeeping and laundry services
EVI DENCE- BASED DESI GN
Evidence-based design is more than the beautification of the facility. It is
founded on the idea that the facilitys construction and design should incor-
porate the principles and research findings from healthcare architecture and
design, environmental psychology, human factors, and industrial engineer-
ing (Henricksen et al. 2007). Evidence-based design strives to improve air
quality and lighting, reduce noise, encourage hand hygiene, reduce walking
distances, improve wayfinding, incorporate nature, and accommodate family
needs.
Recent research has demonstrated the positive impact of environmental factors on
clinical outcomes, patient satisfaction, and providers work/life quality (Ulrich et al.
2004; Marberry 2006; Joseph 2006). Because it is outcomes focused, evidence-
based design constructs single or private rooms, not only to satisfy the patients
need for quiet and privacy but also to lower the likelihood that the patient will
contract an infection.
Kroll (2005) enumerates several principles of evidence-based design:
1. The change has to bring about measurable, positive outcomes, not just serve
as an attractive feature.
2. The design has to target signifcant healthcare delivery or patient care
concerns, not just stress. Reducing the rate of medication errors and
shortening the hospital stay are good clinical aims for evidence-based
design.
Chapter 4: Creating a Healing Environment 83
3. No two designs can be exactly alike, because every organization is unique.
Findings from research must be adapted and applied to the reality and
circumstances of the facility.
Cost
Unless you are building a new facility, one of the challenges of using evidence-based
design in healthcare facilities is its expense. Major environmental renovations or
design alterations can be costly. Tight budgets make justifying these design invest-
ments difcult. Thus far, one study shows that the initial investment can be offset
by the positive outcomes and savings from those improvements (Kroll 2005), but
much work still needs to be done in providing the costbenet justication for
using evidence-based design principles.
HEALI NG ENVI RONMENT
Evidence-based design is part of the healing environment concept. Numerous stud-
ies show that a healing environment has therapeutic effects on both patients and
staff. Research by Ulrich and colleagues (2004) found that a healing environment
leads to faster recoveries, higher levels of patient satisfaction, reduced pain, fewer
cases of infection, and lower stress levels in visitors and staff. Similarly, Zborowsky
and Kreitzer (2008) argue that these changes also can help prevent medical errors
and hospital-acquired infections, while improving staff morale and effciency.
Initially, the redesign of the service setting focused on public spaces (e.g., lobby,
reception areas, grounds) but overlooked the private areas (e.g., patient rooms,
exam rooms). Organizations were installing spa-like features, harnessing natural
lighting, and planting gardens. Bigger redesigns included new building facades,
soaring atriums, water features, and marble lobbiesall of which project an im-
pressive image. Although such designs contribute to a welcoming, soothing set-
ting, they do not affect the areas in which patients undergo or wait for treatment
(Landro 2008).
Thanks in part to the growing evidence-based design movement, more organi-
zations are paying closer attention to how both public and private spaces contrib-
ute to patient health and satisfaction. Following are examples of this design trend:
Orange City Area Health System, Orange City, Iowa: Private patient rooms
are situated in the back of the building and have a view of the prairie, a
84 Achieving Service Excellence
pond, and a healing garden. Each room also has a family seating area
(HGA 2006).
Alta Bates Summit Medical Center, Oakland, California: The entry hall to
the new breast health center is circular and covered with mosaic tiles. Benches
line the hall, and sounds of owing water and birds chirping can be heard.
The waiting room has a tree-like hanging sculpture and colored glass vases
(Landro 2008).
Seattle Cancer Care Alliance, Seattle, Washington: The waiting area for
patients who have breast or gynecologic cancer is a light-flled room with
views of Lake Union (Landro 2008).
The University Medical Center North, Tucson, Arizona: The American
Institute of Architects honored the medical center with a Healthcare
Design Award. The building itself has three courtyards and has views of the
surrounding mountains. The Institute said this about the design: It invokes
the power of the desert landscape to dene a place of inspiration and healing
(Landro 2008).
St. Johns Heart Hospital, St. Louis, Missouri: Artwork that conveys feeling
of hope and light is strategically placed throughout the interior of the
hospital. Pottery, sculptures, paintings, prints, and other pieces are displayed
in all patient rooms, care units, and waiting and reception areas. In the
emergency department, the ceiling is painted with a sky mural and the walls
are covered with oversized nature prints (Brady Spellman and Franke 2007).
According to Jain Malkin (1992), a world leader in healthcare design and heal-
ing environments, facility design should not just fulll an aesthetic purpose; it
should also reduce stress and lessen anxiety for all those who enter the facility and
the treatment areas. The use of color enriches the environment and generates the
same response as nature does (Beckwith 2008). Also, staff surveys conducted by
Parrish Medical Center revealed that design that brings in natural light, mimics
home comforts, and improves air ow have a positive effect on patient care and
staff s work life (Stenz 2008).
The Center for Health Design recommends seven elements conducive to heal-
ing environments (Parrish Medical Center 2008):
1. Nature
2. Color
3. Healthy building
4. Healthy lighting
5. Physical security
Chapter 4: Creating a Healing Environment 85
6. Waynding
7. Cultural responsiveness
These elements are explored throughout the chapter.
Exhibit 4.1 provides a comprehensive, step-by-step approach to creating a heal-
ing environment. Such an environment can serve as the organizations competitive
edge in a consumer-driven market.
Family-Friendly, Homelike Design
Consider the psychological and social benefts in a nursing home designed by
healthcare architect Lloyd Landow. Landow lessened the typical monotonous ef-
fect of long hallways by placing small, angled alcoves at the entrances to patient
rooms. Landow calls this technique neighborhooding, as the design resembles a
neighborhood street (Montague 1995). Neighborhooding makes the hallway feel
and look like a row of front porches, where residents and visitors can sit to socialize
or watch the goings-on on the unit without feeling intrusive or in the way. This
design allows residents to get out of their rooms and take part in the life and activi-
ties of the facility.
Wood foors, soft lighting, cherry armoires that hold fat-screen TVs, back-lit
nature photographs, and hidden medical equipment are just some of the home-
like features being installed at many newly constructed hospitals (Carpenter 2009;
Medical News Today 2006). This trend is not confned to the United States. A uni-
versity hospital in Oslo, Norway, has been designed to mimic a small village: The
main thoroughfare is colorful and curves, leading to patient care areas, labs, and
other units that surround a courtyard. The Frank Gehrydesigned Maggies Centre
(cancer care clinic) in Dundee, Scotland, follows the same healing principle. The
interior is made to look like a cozy home with the use of large windows that open
to the sky and the landscape, warm wood details, and curving stairs (Arcspace
2003).
Link to Nature
Nature can distract patients from their illness and enhance their sense of well-
being. According to Stone (2009), natural images such as fowers and trees, the
sound of water, and natural materials like wood and stone resonate with us on a
deep level and help us reconnect with our own basic nature. Moreover, empirical
86 Achieving Service Excellence
Exhibit 4.1 Approaches to Creating a Healing Environment
Environmental Dimension Approach
1. Ambient Conditions
A. Objective: A feeling of physical comfort
before, during, and after service delivery
A. Provide private and public spaces that are
clean, odor-free, quiet, well-equipped, and
temperature-controlled (i.e., not too cold,
not too warm); use nonslip ooring and
padded material
B. Objective: A feeling of psychological
comfort before, during, and after service
delivery
B. Place vibrant dcor and furnishings in
all rooms; incorporate natural elements
and warm colors; offer soothing music,
if available
2. Spatial Conditions
A. Objective: A positive rst impression A. Present a clean, well-lit interior, manicured
or well-tended exterior, abundant greenery,
clear and wide hallways and pathways;
well-lit and well-furnished rooms and
waiting areas; well-lit parking lots with
uniformed staff
B. Objective: Comfortable, well-laid-out
patient room
B. Present clean rooms, easily accessible
equipment, wide doorways, nonslip
ooring
3. Signs, Symbols, and Artifacts
A. Objective: Signs that are easy to use,
nd, and understand
A. Use simple language in big, bold letters;
place signs in obvious and expected
locations; make signs available in another
language (e.g., Spanish); use international
symbols, not obscure representations; use
clear maps, arrows, or kiosks to direct
foot trafc
4. Other People
A. Objective: Staff attire that meets
customer expectations
A. Survey customers about their uniform
preferences (e.g., scrubs color, likes/dislikes
of lab coats); implement good ideas with
approval from staff
Chapter 4: Creating a Healing Environment 87
studies show that postsurgical patients who are assigned to rooms with views of
nature (e.g., parks, gardens, water) give better nurse evaluations, take less medica-
tion, and have shorter hospital stays (Horburgh 1995). Even painted nature scenes
have a positive impact on patient outcomes (Wiley 1999).
The award-winning rooftop garden at Schwab Rehabilitation Hospital in
Chicago was built to alleviate the stress and pain of physical recovery (AHRQ
2009). Anecdotal evidence indicates that the Schwab rooftop garden yields ben-
efts: Patients report that the healing garden serves as a source of optimism and
motivation. Therapists report that daily access to nature and the outdoors makes
the rehabilitation process easier for patients, while administrators believe that the
garden helps patients to gain more independence (AHRQ 2009).
In his book The Biophilia Hypothesis, author E. O. Wilson introduced the term
biophilia (which means love of life) and claimed that people are inherently drawn
to and nourished by nature (Cooper 2008). This idea evolved into biophilic design,
the concept of incorporating natural elements into living and working quarters to
encourage health and well-being. Biophilic design is unlike the green movement in
that its focus is on the relaxing benefts of a nature-infused setting, not on sustain-
ability of materials, although this design certainly contributes to environmentally
friendly schemes.
Indoor and outdoor gardens are elements of biophilic design, and these gar-
dens can be found in many hospitals, such as Lucille Packard Childrens Hospital
in Palo Alto, California; Bronson Methodist Hospital in Kalamazoo, Michigan;
and Christus St. Michael Health System in Texarkana, Texas. Various studies show
that the most important benet of hospital gardens for all users is recovery from
stress (Cooper 2008). For more information on this concept, see the book Biophilic
Design: The Theory, Science, and Practice of Bringing Buildings to Life, edited by
Stephen Kellert.
A great example of bringing nature inside is Parrish Medical Centers four-story
atrium that is decorated with planters and fountains that harness light, color,
texture, and sound. Located in Titusville, Florida, Parrish Medical Center (2008)
was one of the frst members of the Center for Health Designs Pebble Project and
is considered one of Americas fnest healing environments.
Use of Humor
Adding humor to the environment is another way of enhancing the moods and
spirits of patients, families, and staff. INTEGRIS Baptist Medical Center in
Oklahoma City established the Medical Institute for Recovery Through Humor
88 Achieving Service Excellence
(M.I.R.T.H.) program (Zizzo 2008). INTEGRIS also holds an annual, weeklong
Camp Funnybone, which is designed to teach kids to use laughter as a coping
tool (INTEGRIS 2009), Similarly, St. Lukes Episcopal Health System in Hous-
ton, Texas, has a volunteer team of laff staff clowns who visit patient care areas
to spread fun and laughter.
Humor is also a critical component of the Healing Arts Program at El Camino
Hospital in Mountain View, California. According to one of the programs sup-
porters and creators, Dr. Joshua Sickel, a pathologist and an amateur stand-up
comedian, When people are hurting, a little humor can make a huge difference.
At the hospital, a volunteer jester . . . roams the hospital oors, connecting with
patients and distracting them . . . from health problems and the hospital routine.
Also, various comedy shows and stand-up routines are broadcast on the hospitals
dedicated humor channel (El Camino Hospital 2009).
Importance to Employees
No one spends more time in the healthcare setting than employees do, be they
clinical or nonclinical staff or full time, part time, or under contract (as in the case
of most doctors). Thus, a well-designed, clean, well-lit, and safe work environment
promotes employee satisfaction, which is highly correlated with patient satisfac-
tion. A pleasant work setting enables staff to concentrate on the task at hand, com-
municates that management cares about staff s well-being, and instills pride and
joy among staff about the workplace.
Most important, a healthcare organization that invests money, time, and energy
on the details of the service setting (even those details that external customers will
likely not notice) is showing its commitment to providing high value and quality.
For example, an organization that cares about its positive image will not hire or tol-
erate people who wear unclean, ragged, or business-inappropriate clothing. It must
uphold a specic dress and appearance code or policy to indicate its respect for its
work, customers, and employees. Careful attention and regular enhancements to
the details of the service setting result in an attractive, comfortable workplace.
Simply, just as the setting can affect the patient and familys attitude, it can also
affect the employees attitude and productivity. Employees who work in pleasant
environments are more likely to provide the level of service that exceeds patient
expectations, which then leads to satisfaction and loyalty (or willingness to return).
In contrast, employees who work in dark, dirty, noisy, crowded, and dilapidated
facilities may not be as happy to come to work or as productive as their counter-
parts in newly designed spaces. Research by Lin and colleagues (2008) found that
Chapter 4: Creating a Healing Environment 89
a favorable perception of the physical environment is positively associated with
job satisfaction and negatively related to employees intention to leave or to reduce
working hours.
ENVI RONMENTAL TRENDS AND STRATEGI ES
THAT ENGENDER CUSTOMER LOYALTY
When it comes to settings, empowered healthcare consumers expect more than the
basics (e.g., functioning equipment, competent and helpful staff, hygienic pub-
lic and private areas, easily navigable layout). They want a healthcare setting that
appeals to their senses and that makes them feel comfortable, welcomed, and in
capable hands. In this section, we enumerate the trends and strategies that enrich
the setting and thereby promote customer loyalty.
Theming
All aspects of the physical settingdcor, size and layout, lighting, colors, signs,
employee uniforms, and supplies and equipmentmust complement and support
each other to create the sense of an integrated design. This consistent look may be
achieved through theming.
Theming is the process of organizing or staging the physical elements of the
environment around a main idea. Receiving high-quality clinical services within
an effectively themed environment adds up to a memorable experience (Pine and
Gilmore 1998). This kind of experience reinforces a patients desire to return and
conrms the perception of high quality and high value.
For example, at High Point Womens Center in High Point, North Carolina, the
themed design is a spa. The waiting room has Asian-style furniture, screens, and lamps
as well as simple fower arrangements. A spa-themed postpartum room carries the
same minimal, clean design with screen-like lighting and hidden storage for medi-
cal equipment and supplies. The spa theme works with clinical requirements and the
existing space, but it alleviates the boredom while waiting, the stress of the medical
environment, and the confusion of medical procedures (Huelat 2009). Similarly, The
Windsor of Lakewood Ranch, an assisted living facility in Bradenton, Florida, has a
West Indies theme, complete with water-resistant fabrics in bold colors and patterns
(Volzer 2006).
Themes may be quite general. To create a general feeling of comfort, a hospital
can use padded seating, neutral or warm paint colors, and soft lighting. To create a
90 Achieving Service Excellence
stimulating environment, a nursing home can use bright paint colors, lively ambi-
ent music, and action photographs. In childrens and womens care units, a family-
centered theme is most effective.
For example, at the new Womens Health Center of Providence Sacred Heart
Medical Center in Spokane, Washington, the labor/delivery rooms are spacious
and equipped with day beds, TVs and DVD players, and refrigerators. In these
rooms, medical equipment is hidden from sight and the dcor has a sophisticated
hotel feel, with an earth-tone palette, curved walls, and wood foors (Northwest
Business Press 2005).
A themed environment may not always be appropriate in a healthcare set-
ting, and it can present risks. The appeal of a particular theme is subjective: One
group may nd it attractive and consider it an enhancement, while another may
be turned off by it and consider it a dissatiser. This latter reaction could minimize
the providers competitive advantage. Healthcare executives need to be sure that
whatever theme they choose does not create a negative reaction among a large seg-
ment of its customers.
Hotel-Style Amenities
A new trend in enriching the healthcare experience through improving the setting
is offering hotel-style amenities, such as valet parking, spa services, and free wireless
Internet access. Here are some examples of this trend:
Dr. P. Phillips Hospital in Orlando, Florida: The emergency department is
staffed with guest service representatives 24 hours a day. These employees
help out-of-town patients change fights, cancel reservations, or arrange
ground transportation (Sashin 2007). Similarly, Cleveland Clinic in Ohio
offers a medical concierge service that arranges medical appointments,
transportation, and hotel rooms for patients and family members from out of
town.
MD Anderson Cancer Center in Houston, Texas: The hospital owns a hotel
(operated by Marriott) where patients and families who do not live in the
institutions service area can stay (Petersen 2007). The hotel is connected to
the medical center by a walkway.
Celebration Health in Celebration, Florida: The waiting area in the
emergency department is equipped with two computers with Internet access
and two printers that are free for use by patients and families. Also, the
hospital offers in-room massages and manicures, pipes in soft music to the
Chapter 4: Creating a Healing Environment 91
parking lots, and transports (on a golf cart driven by a volunteer) patients who
need help getting from the front door to their cars in the parking lot (Sashin
2007).
Sacred Heart Medical Center at RiverBend in Springfeld, Oregon: Everyone
who enters the hospital is greeted warmly. Fireplaces, lounges, and coffee
shops can be found inside (Bush 2007).
Henry Ford West Bloomfeld Hospital in West Bloomfeld, Michigan: Patients
are treated as guests. This means that nurses do not come to a patients room
from 10:30 pm to 5:30 am, unless medically necessary; patients can order
what they want to eat, when they want to eat; visitors are not restricted by
visiting hours and may stay overnight or for an extended period; headboards
are upholstered; and closets can be locked (Henry Ford 2009). In fact, the
hospitals president was a hotelier, having worked for the Ritz-Carlton before
his healthcare management career (Bush 2007).
Food Service
Hospital food has become fresher, tastier, and more nutritious in the last several
years (Landro 2007a; McPherson 2007). Some hospitals employ trained chefs who
create restaurant-quality recipes, even for patients on restrictive diets (no or limited
salt, fat, and sugar). Also, dietitians are prescribing more substitutions and health-
ier versions of popular dishes, such as roasted instead of mashed potatoes or soy
crumbles instead of ground beef. About 70 percent of U.S. hospitals are planning
to roll out new menus to keep pace with evolving culinary trends in the restaurant
industry. Improving hospital food service presents immediate advantages: (1) It
allows hospitals to cater to each customers unique dietary wants and needs, and
(2) it offers a way to teach patients about portion control, substitution, and menu
planning (Landro 2007a).
Concierge Medicine
Concierge medicine is a controversial (but growing) innovation, no matter what it
is calledretainer medicine, boutique medicine, wealth care, innovative medical
practice, or direct care. Under this system, patients pay an annual retainer fee to a
primary care physician, who in turn provides same-day appointments, longer vis-
its, house calls, consultations by phone or e-mail, and prevention and nutritional
services (Cohen 2008; Kalogredis 2004; Zuger 2005; Fantin 2006). The retainer
92 Achieving Service Excellence
fee is fxed and ranges from the standard $1,500 to $25,000, depending on the
services included (Sack 2009). Essentially, what the retainer pays for is the direct,
no-wait, 24/7 access to the doctor, which is unattainable in the regular insurance-
based system. Also, the fee allows the physician to keep the number of patients low,
which in turn minimizes the demand on the physicians time. This time may then
be used for longer patient visits, which increases patient satisfaction.
Concierge medicine has been criticized for exacerbating the inequities in Amer-
ican healthcare (Fantin 2006). However, both the concierge physicians and their
patients seem quite pleased with the results (Sack 2009; Kalogredis 2004).
Green Movement
Many healthcare organizations are beginning to adopt green building principles
as another way to respond to customers expectations. Green indicates a consid-
eration for Earth itself, and the movement intends to stem or reverse the environ-
mental damage inicted by human and business practices and policies. For health-
care facilities, implementing practices associated with the green movement sends a
message to its employees and patients about the commitment the organization has
to nature and natural things. It also can mean multiple and high costs, including
new construction, restructuring old buildings, and retrottingall of which aim
to be sustainable in the long and short terms (Guenther 2008).
Healthcare facilities are implementing sustainable approaches for a variety of
reasons (Guenther and Vittori 2008):
Many faith-based organizations consider green practices a part of their
stewardship mission.
Many nonproft institutions count green processes toward their community
benets.
Green buildings enhance human health and make a lot of business sense.
Both patients and employees expect their organization to care about the
natural environment and to show it in tangible ways.
Nearly every hospital that adopts green strategies reports improved worker re-
cruitment, satisfaction, and retention (Sadler 2006), and the same improvements
are true for patient satisfaction and clinical outcomes.
One lesson for hospitals considering or planning a green construction or remod-
eling project is to view any one-time capital costs (a major investment) in terms of
long-term operational savings (Sadler 2006). While the current economic meltdown
Chapter 4: Creating a Healing Environment 93
and reimbursement constraints have served as a barrier to the comprehensive im-
plementation of green principles in some healthcare facilities, some green initia-
tives can be implemented for little or no cost. Vernon (2009) suggests that, despite
nancial realities, hospitals, health systems, clinics, and other service providers can
still green their facilities by (1) maximizing the efciency of mechanical, electri-
cal, and piping systems, (2) capitalizing on incentives for sustainable practices, and
(3) using lighting retrofts and other energy-saving supplies and equipment.
Reporting
The reporting of patient experiences in hospitals is now mandated by the federal
government. An initiative of the Centers for Medicare & Medicaid Services and
the Agency for Healthcare Research and Quality, the Hospital Consumer Assess-
ment of Healthcare Providers and Systems (HCAHPS) is a survey that aims to do
the following:
Produce comparable data on measures important to patients or healthcare
consumers.
Create incentives for hospitals and providers to improve quality of care.
Increase provider accountability and transparency through requiring public
reporting of quality practices.
The HCAHPS (see www.hcahpsonline.org) survey is composed of 27 items, 18
of which encompass critical aspects of the hospital experience, including cleanli-
ness, quietness, and service quality. As of this writing, no data are available that
show the impact of this initiative. But it seems reasonable to predict that hospitals
committed to providing safe, comfortable, and patient-centered care will be rated
highly by patients.
Ultimately, HCAHPS will have a signifcant infuence on patient provider
choice and patient loyaltyboth of which can boost a hospitals market share and
nancial bottom line.
Healthplexes
Over the last decade, healthplexes have gained rapid acceptance in the health-
care industry, generating a following among consumers who desire a one-stop-
shop customer-focused experience. Healthplexes (a combination of health and
94 Achieving Service Excellence
complexes) are hospital-based health clubs that specialize in wellness, prevention,
and education. At a healthplex, members (either individually or with the whole
family) can use the fully equipped gym and sports amenities, consult with a nutri-
tionist, and attend wellness classes or presentations.
Here are some examples of a healthplex:
Celebration Health, Celebration, Florida. This healthplex offers womens and
mens programs, a sports medicine center, a health club with a swimming
pool, a basketball court, and a day spa. Its cafeteria presents healthy meals,
cooking demonstrations, and nutrition lectures. The building is connected by
an impressive lobby to the hospital (Florida Hospital) and medical ofces. See
www.celebrationhealth.com.
Rush-Copley Healthplex, Aurora, Illinois. Boxing, swimming, Pilates, tennis, and
yoga are just a few of the classes taught at this healthplex. Part of the Rush-Copley
Medical Center campus, the healthplex offers adults and childrens ftness activities,
a fully equipped gym, consultations with personal trainers, and educational tools
and information. See www.rushcopley.com/healthplex/index.aspx.
FOUR ENVI RONMENTAL DI MENSI ONS
Because most patients are anxious about the healthcare experience, the service pro-
vider must demonstrate that it cares by designing a service setting that is nurturing,
responsive, and active/interactive. Exhibit 4.2 shows the four dimensions of the en-
vironment: (1) ambient conditions, such as smells, lighting and colors; (2) spatial
conditions, such as layout and equipment; (3) signs, symbols, and artifacts, such as
signage; and (4) other people.
Exhibit 4.2 Four Dimensions of the Environment
Dimension Sample Elements
1. Ambient conditions Cleanliness, temperature, music, colors, odors, lighting,
and textures
2. Spatial conditions Layout, crowding, parking and drop-off areas,
equipment, furnishings, functional congruence
3. Signs, symbols, and artifacts Signage, waynding aids, maps
4. Other people Employee dress code, appearance, and behavior
Chapter 4: Creating a Healing Environment 95
Consciously or unconsciously, each customer (patient or employee) responds
to the environment on the basis of that persons cognitive, emotional, and physi-
ological conditions. These reactions are internal responses that drive external
behaviors. Simply, if the settings dimensions make a patient feel bad, she will
avoid it. This avoidance, in turn, has a negative effect on the ultimate results
or outcomes desired by the organization. See the section on Servicescape for
more information on these customer responses. Lets discuss these environmental
dimensions.
Ambient Conditions
Ambient conditions are factors that affect the ergonomics (comfort and efciency)
of the space, such as cleanliness, air temperature, humidity, and quality; smells
and sounds; and lighting. A dark, dank, and noisy room Is not consistent with the
patients ideas of calm and healing.
Noise and Music
Applied research conducted in hospitals underscores the fact that noise has detri-
mental effects. Noise is found to be a major cause of loss of sleep (Parthasarathy
2004) as well as psychological stress, increased blood pressure, and increased heart
rates (Ulrich 2006). Strategies for reducing noise should include more than asking
staff to be quiet while they perform their daily tasks. Such strategies should involve
the following (Ulrich 2006):
Seek out all sources of noise to eliminate unnecessary reverberations.
Design a layout that minimizes the travel of sounds from one area to
another.
Use sound-absorbent materials, such as carpeting or acoustic ceiling tiles.
Environmental sounds can be controlled and should serve a purpose. Con-
trolled sound (music) should complement the total healthcare experience and the
message the organization is conveying. For example, soft music (e.g., instrumental,
classical, ballads, nature sounds) is soothing and facilitates relaxation. Music can
also affect behavior. For example, people tend to eat faster and drink more when
fast, loud music is playing; slow music, on the other hand, encourages leisurely
dining, which helps digestion. In a study of diners at the Faireld University caf-
eteria, researchers found that diners chewed an average of 4.4 bites a minute to fast
music and 3.83 bites a minute to slow music (Petersen 1997).
96 Achieving Service Excellence
Scientic research shows that music is benecial for the body. At Saint Agnes
Medical Center in Fresno, California, a music lab gives patients and staff a chance
to compose or play music on computerized pianos (Keeler 2008). This recreational
activity reduces stress and promotes healing. In addition, music (along with art-
work) relaxes the mind and body, which leads to a greater likelihood that the pa-
tient will respond well to treatment (Stenz 2008).
Lighting
If the lighting in a service setting is not noticeable the rst time you enter, it is
probably done correctly. Conversely, if the lighting calls your attention immedi-
ately, it is not appropriate. Like environmental sounds, lighting should be con-
trolled and should have a purpose. Every area in the facility demands the right
levels of light.
For example, lighting in the operating room should not be dim, and lighting in
the waiting areas should not be too bright as to make patients and family members
squint because of the glare. Because lighting is part of the setting, it should con-
tribute to enhance the total healthcare experience. Things that are lit call attention
to themselves, and things that are kept dark are ignored.
Natural light plays a role in lifting patient and staff moods. In one study, hospital-
ized patients whose rooms were situated in the path of intense sunlight experienced
less stress and required fewer medicines and thus incurred lower costs than patients
whose rooms were shaded from the sun (Henricksen et al. 2007). Similarly, bed-
ridden patients who were assigned to a room with a view of nature, rather than
a brick wall or a parking lot, recovered faster and needed fewer pain medications
(Ulrich 1991). Unfortunately, many nurse stations and staff breakrooms are not
designed with daylight-enhancing features such as tall windows (Joseph 2006),
which is a disservice to those who provide direct care.
Cleanliness
Every inch of the facility must be held to rigorous sanitary standards (McCaughey
2007). The Joint Commission (2008), which emphasizes hand hygiene in its stan-
dards, conducts accreditation visits every three years to ensure hospitals compli-
ance with its quality standards and other regulations. This type of vigilance, how-
ever, is not enough. After all, clean hands can be recontaminated by bacteria-laden
surfaces. Hand-washing should be just one among many measures that a health-
care provider takes on a daily basis. More sanitary inspections should occur in all
provider settings, including physician ofces.
Chapter 4: Creating a Healing Environment 97
Spatial Conditions
Spatial condition refers to the layout, size, shape, distance, and accessibility of
equipment, furnishings, hallways and walkways, and doors. How the space is
laid out can infuence perceptions of being open and friendly or closed-in and
alone. For example, wide and roomy areas are welcoming, while narrow stairways
and entryways evoke crowdedness. Following are some basic principles of space
design.
1. The space must be safe and easy to use. The space has to be designed to
minimize the risk of falls and injuries, especially for elderly persons or
people with physical disabilities.
2. The space has to enable the provision of service. For example, in a nursing
home, resident rooms must be designed so that space is allocated for both
personal belongings (including furniture) and required clinical equipment
and supplies. Sometimes, in an attempt to achieve or replicate a homey feel,
the facility will allow patients to keep too many personal items in too small
a space, and this practice interferes with the provision of clinical services. A
cluttered space also may depress rather than elevate the resident. The same
principle applies to public areas. In this case, the challenge is balancing
conicting uses.
3. The space should be designed to ease way-nding. Patients, families, and visitors
must be able to locate exits, entrances, restrooms, cafeterias, elevators, and
other essential amenities and services without feeling disoriented or lost.
Employees and other personnel must be able to traverse the facility through
wide, clear, and well-connected passageways.
4. The space must have functional congruence. Functional congruence refers to how
the equipment, design, and layout of the space t its function. For example,
in a modern birthing suite, medical equipment and supplies (the function) are
hidden in wood cabinets (the general design). In this way, the suite not only
serves its purpose but also appeals to the established aesthetic.
5. The space must be adaptable to changing healthcare delivery demands. Some
hospitals are repurposing existing spaces in the emergency department (ED)
to accommodate patients traditionally placed in the hallways to wait for
inpatient beds (Landro 2006a). These facilities are using industrial production
models to efciently move patients from the ED to care units and then out
of the hospital. Through Adopt a Boarder programs, EDs are sharing the
98 Achieving Service Excellence
responsibility with other departments and their personnel. Nurses in other
units are asked to take care of ED patients to relieve the ED staff, and special
observation units are used for noncritical cases with a goal of sending them
home with follow-up care from a home health aide (Landro 2006a).
Signs and Symbols
According to Carl Sewell, signs serve only three purposes: (1) to name the business
(e.g., Walgreens, Humana Hospital); (2) to describe the product or service (e.g.,
Radiology, Hematology); and (3) to give directions (e.g., Do Not Enter, No Smok-
ing) (Sewell and Brown 1990, 22).
Signs are explicit physical representations of information that customers want,
need, and expect to nd. Signs must be visible, clearly written, and located in logi-
cal places (e.g., on doors, next to a symbol, at eye level). In many clinics, signs at
the entry point (e.g., reception area, lobby) direct patients where to nd service
areas. In a facility that serves a multilingual population, signs must be written in
the languages most commonly used in the community.
The customers point of view, rather than the organizations, must be taken into
account when creating signs. For example, a You Are Here sign on a map of a
large medical campus can be frustrating, instead of helpful, to a frst-time visitor.
Because such a sign is made by an insider to the organization, the sign may not
consider the perspective of a customer who is oblivious to the distance between
buildings or even the direction (north, south, east, west) he is headed. As a result,
the proverbial You Are Here sign is often no better than no sign at all. A confused
customer feels not only lost or disoriented but also stupid, and customers do not
think kindly of organizations that cause them to feel stupid. Signs should be clear
and should not be an exercise in complex terminology or subtle humor.
Circus legend P. T. Barnum set up his exhibits and signage to guide customers
from start to nish. A door right after the last exhibit was labeled This way to the
egress. Circus patrons, hoping to view a rare animal or a bird (egret) on the other
side, went through the door only to nd themselves in an alley outside the build-
ing. Obviously, some customers were not pleased at the deception. Even though
such a tongue-in-cheek sign may be appreciated by many circus patrons, it will not
be welcomed at a healthcare facility. After all, much of what happens in a hospital
or clinic is no laughing matter.
Signs should also ease both entry into and exit out of any treatment area. For
example, a patient who just underwent a procedure that required her to take a
sense-altering drug or behavior-changing intervention should be provided clear
Chapter 4: Creating a Healing Environment 99
directions that enable her to navigate out of the area, especially if no one is avail-
able to assist her. In many facilities, colored tiles on the oors or colored paint
strips on the walls help patients and other customers locate their destination.
Like signs, symbols convey a message or information. Sometimes symbols are
made up of words, and other times the symbols are icons that represent universal
ideas (e.g., symbols for recycling, no smoking, handicap, Red Cross). Universal
symbols are especially important in urban healthcare settings where the patient
population comes from many different nations and cultures and speaks many dif-
ferent languages. Colors, numbers, and shapes are used as symbols to distinguish
identical areas, such as multilevel garages, vast parking lots, and elevator banks. If
the patient absolutely must remember specic information, a simple symbol often
aids him best.
Artifacts are physical objects that represent something beyond their functional
use; as such, they are a type of symbol. Childrens hospitals often use artifacts to
engender warmth and hope. A little red wagon is not merely a toy, but it is also
a representation of freedom to move around and play. The wagon also serves as a
symbol of normalcy despite the childs ailment.
Other People
The fourth environmental dimension includes employees, other patients, and visi-
tors. How other people look, act, and dress can have an impact on those in the
healthcare setting. Tight waiting rooms, packed emergency departments, and other
crowded situations make people feel as if the organization does not care about their
privacy, uniqueness, or dignity. Loud, curt, or grumpy employees can negatively
affect the patients general mood. In other words, the people in the healthcare set-
ting can inuence how the patient, the staff, and family companions and visitors
feel about the quality of the clinical care, the caring nature of the organization, and
the perception that the organization has a strong patient focus.
Illness can also take a mental, physical, and emotional toll on patients. In such
situations, they want to see that they are not the only ones with medical burdens.
Studies have shown that patients tolerate pain better when they are in the company
of others who suffer the same pain. Misery loves company, as the clich goes. But
patient happiness and satisfaction are also contagious.
The life-or-death trait of the healthcare setting might feel even more taxing and
depressing without the presence of other people. In group therapy, for example,
other people are not there as merely scenery; they exist to participate in and copro-
duce that treatment experience. Of course, patients do not seek out healthcare just
so that they can commiserate with other people.
100 Achieving Service Excellence
Other people, except for clinicians and other employees, are usually perceived
as part of the environment, not as part of the service itself, but the distinction be-
tween the two is not always clear.
SERVI CESCAPE
Benchmark healthcare organizations seek input from and listen to their customers
(patients and employees) and use that knowledge and evidence-based principles to
design a servicescape. The servicescape is the sum of a patients impression on each
of the four environmental dimensionsambient conditions, spatial conditions,
signs and symbols, and other people.
Because each customer experiences the environmental dimensions differently,
no two servicescapes are alike. Moreover, every customers reaction is a product
of his or her personality, values, mood, prior experiences, expectations, and other
moderators. Thus, a 72-year-old Asian womans servicescape will vary from that of
a 24-year-old Caucasian man, even if they received the same services from the same
providers in the same environment on the same day.
Moderators
Moderators are the personal factors that inuence the way a person reacts to or per-
ceives an experience. These factors include age, cultural and socioeconomic back-
ground, physical abilities, life views and experiences, character traits, and mood on
a given day. For example, Person A prefers to be alone and thus considers a waiting
room crowded if it contains more than ten people. Person B, on the other hand,
thrives in a group setting and thus views the same ten people as a sign that the staff
are efcient in getting people in and out of the waiting room.
Cultural or ethnic background is also a major moderator. In some cultures, red
is a vibrant, life-affrming color, while in others, red is offensive and threatening. A
frm handshake, eye-to-eye contact, a hug, and other types of body language also
communicate different meanings to different groups and could sway a persons
opinion about the general environment.
A persons health status greatly affects the way he perceives the setting. For ex-
ample, if he arrives in the emergency department with severe chest pains, he is not
going to notice the ambient and spatial conditions of the room. A patients dispo-
sition also plays a partthat is, if she is good-natured and is not suffering from a
traumatic medical event, she is more apt to pay attention to her surroundings. She
Chapter 4: Creating a Healing Environment 101
may nd the music piping into the waiting room soothing or the mural on the wall
comforting. Conversely, a patient in a bad mood may become irritated by the long
distance he has to walk from the front door to the pharmacy or may become upset
by the lack of visible signs to direct him to his destination.
People who have had no previous experience with the facility will be most in-
uenced by environmental cues. These new patients will expect and be sensitive
to the disinfectant or soapy smells of cleanlinessthe kind that sends the message
This place is sanitary. In contrast, a returning patient may be immune to or fa-
miliar with the aroma in the air, but she is nonetheless expecting and wanting the
same cleanliness as desired by a new patient.
Responses to the Servicescape
The servicescape brings about three types of responses: physiological, cognitive,
and emotional. These responses lead the person to make one of two choices about
the healthcare experience: approach or avoid. This response does not include the
clinical service or its delivery; it is simply the gut-level reaction to the service en-
vironment.
Servicescape responses can affect customer satisfaction, repeat visits, employee
retention, and word of mouth. Thus, healthcare managers should invest time to
enhance the environmental dimensions that t the quality and value message they
want to convey to customers (both external and internal).
Physiological
A physiological response is a physical reaction to environmental stimuli. Ambi-
ent conditions, such as odor, sound, temperature, and light, almost always elicit a
physiological response. Another, but less obvious, source of a physiological reaction
is a persons capacity to process information.
A classic study found that the human brain can process seven (plus or minus
two) random pieces of information at one time. The study was conducted for a
telephone company, which wanted to know how long a telephone number should
be so that people could remember it. Results led to the use of combinations of
words and numbers to help people overcome their physiological limitations (Ford
and Heaton 2000). Today, the method is still employed by many businesses and is
refected in toll-free numbers such as 1-800-I-FLY-SWA or 1-800-HEALTHY.
The lesson of this study for the healthcare setting is that a lot of random in-
formation coming in at the same time (e.g., too many signs, too many instruc-
tions) can overwhelm the capacity of the human mind, preventing the person from
102 Achieving Service Excellence
comprehending the given information and making him feel uncomfortable, con-
fused, and uncertain. Compounding this issue is a persons illness, age, language
limitation, psychological and physical stress, or unfamiliarity with the healthcare
provider.
The service environment should be made rich or lean with information to ac-
commodate a persons information-processing capability. For example, a waiting
room can be layered with signs, posters, and other informational material because
here the patients are only expected to sit and wait. On the other hand, if a patient
is asked to nd a room or go to a service, she is already preoccupied with that task,
and looking at a kiosk or map that has too much information will only frustrate
her and cause a physiological reaction.
Cognitive
People almost always enter a healthcare setting with expectations that are based on
previous experiences. These expectations inuence what actually happens.
For example, a customer who walks into a hospital cafeteria expects the place to
look like all other cafeterias he has visited before, from the arrow pointing to the
beginning of the line to the stack of trays to the hairnets and white overcoats worn
by the servers behind the long food counter. If the visitor encounters a different
cafeteria setup than the one he expected, he is not only surprised but possibly also
frustrated that he has to learn how to use this unfamiliar system.
Nonverbal communication and messages also invoke a cognitive response. For
example, if a patient sees a healthcare administrator typing on a manual type-
writer, the patient will immediately think that the facility is not technologically
sophisticated; after all, typewriters have given way to computers. Ultimately, the
patient will question the overall level of technology at the organization, including
the equipment used in medical procedures. This perception alone could make the
patient doubt the clinical and operational capabilities of the hospital.
Healthcare organizations should consider the cues or messages that the setting
(including staff and their actions) is transmitting. Customers have cognitive expec-
tations and like to see familiar systems in place.
Emotional
Most people are not immune to an emotional response. Alumnae get choked up
when they return to their alma matter for a reunion. Holiday decorations, the
smell of fresh-baked bread, and an upcoming visit to the doctor or dentist can all
evoke emotional responses.
Two types of emotional responses are important for the organization to balance:
(1) arousal and (2) pleasure or displeasure. Arousal is the stimulation received from
Chapter 4: Creating a Healing Environment 103
Service Strategies
1. Envision and create the environment from the patients, not the
organizations, point of view.
2. Pay equal attention to public (e.g., lobby, reception area, grounds) and
private (e.g., treatment areas, patient waiting rooms) spaces.
3. Identify problems and improvements related to the environmental
dimensionsambient conditions, spatial conditions, signs and symbols,
and other people.
4. Create an evidence-based healing environment to convey and advance
the organizations patient safety, quality improvement, and customer
satisfaction agenda.
5. Manage the physiological, cognitive, and emotional responses of customers.
the environment: A noisy, chaotic department can arouse a recuperating patient.
Pleasure or displeasure, on the other hand, is the reaction from the stimulus: A
noisy, chaotic department can be a cause of displeasure for the recovering patient.
The organization should temper these two emotional responses by presenting a
setting that offers the right amount of arousal and pleasure elements. For example,
a clean and fresh-scented restroom, a picture of a colorful fower, and a smiling re-
ceptionist can all arouse and pleasure. Vibrant murals, vaulted or textured ceilings,
and plush chairs can also balance arousal and pleasure.
CONCLUSI ON
Investments in the service setting can provide high returns in the form of patient
satisfaction, reduced recovery time, improved perception of quality and value, and
intention to return. The environment can inuence customer satisfaction and loy-
alty, so its elements have to be carefully planned, designed, and implemented.
Although more study is needed to fully understand how the environment
affects the health and well-being of patients, much research has been published
about this relationship. In addition, a well-laid-out and maintained space re-
duces stress for employees and caregivers. Healthcare managers should use the
setting as a tool to communicate the organizations commitment to enhance the
total healthcare experience.
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105
Work together with employees to develop a can-do culture of
honesty, integrity, energy, and initiative.
Norman Brinker
C H A P T E R 5
Developing a Culture of Customer Service
Service Principle:
Dene and build a culture committed to providing superb service
for all parts of the healthcare experience
When you walk into Disney World, y on Southwest Airlines, shop at Nor-
dstrom, stay at a Marriott hotel, or receive treatment at Baptist Health Care in
Pensacola, Florida, you sense something special about the place and the people
who work there. If customers of these businesses are asked about their experience,
they describe it as better than expected. Employees of these companies embody
their respective organizations corporate value of exceptional service. For example,
Disney cast members talk about their commitment to the quality of the show they
put on for park visitors.
Healthcare leaders can learn a great deal from customer servicecentered orga-
nizations on how to build a culture of service excellence that both patients and staff
can believe in.
Organizational culture comprises the philosophies, ideologies, values, assump-
tions, beliefs, attitudes, and norms shared by the internal members of the insti-
tution. Culture is the standard or guideline that the group agrees, implicitly or
explicitly, to follow and supportwhether in behaving, decision making, problem
solving, performing a task or duty, or other group work. By nature, culture is dy-
namic and constantly changing. Initially, it is shaped by the founding leaders and
members of the culture itself, but over time, as it is shared, it can change, as more
interactions, experiences, and events occur in the environment.
106 Achieving Service Excellence
In this chapter, we address the following:
The basic elements of culture
The critical role of leaders in defning, teaching, and communicating the
culture
The importance of adopting a customer service culture
BASI C ELEMENTS OF CULTURE
Beliefs and values, norms, folkways and mores, and subcultures are the basic ele-
ments of an organizational culture. The strength of this culture, however, is its
members commitment to it, even when subcultures emerge.
Beliefs and Values
Beliefs form the ideological core of the culture. While culture is a set of assump-
tions about how the organization operates, beliefs explain what those assump-
tions mean. Beliefs defne the relationship between cause and effect. Values, on
the other hand, are the organizations compass. They direct what the organiza-
tion supports and accepts in terms of employee behaviors, mission focus, clinical
approaches and outcomes, to name a few factors. Most institutions have a mis-
sion statement, but not as many have a separate, formal values statement. For
example, a study of VA (Veterans Affairs) facilities found that the more civil the
work unit, the greater the patient satisfaction with the quality of care. In addi-
tion, an emphasis on civility reduced sick leaves, absenteeism, and the number
of complaints submitted to the Equal Employment Opportunity Commission
(Belton and Dyrenforth 2007).
An organizational culture that values and believes in customer service has a bias
for enhancing the healthcare experience for its patients, speeding up resolutions to
problems and complaints, and communicating regularly with its stakeholders. Be-
liefs and values are integrated into every aspect of the employee/human resources
management system, including recruitment, selection, performance appraisal, and
rewards and compensation.
Customer-focused beliefs and values are developed and strengthened by
actively involving employees in customer initiatives,
applying a facilitative management (coaching) approach,
Chapter 5: Developing a Culture of Customer Service 107
empowering employees in decision making, and
communicating regularly and widely with staff using all available media (e.g.,
intranet, internal newsletter, bulletin board).
According to service expert Len Berry (1999), Sustained performance of qual-
ity service depends on organizational values that truly guide and inspire employees.
And how does an organization get such values? It gets them from its leaders who
view the infusion and cultivation of values within the organization as a primary
responsibility. The responsibility of the leader in creating a culture that values cus-
tomer service is perhaps the most important among his or her duties. In Chapter
3, we discussed the importance of aligning the strategic plan with values and other
organizational components. Without this alignment and a strong stakeholder sup-
port for the culture created by those values, a commitment to a patient-focused
mission would be impossible to achieve.
Norms
Norms are standards of behavior (e.g., what to do and say, what to wear, how to
conduct oneself ) expected and desired by the organization from all employees, in-
ternal associates, and even those external to the organizationcustomers, patients,
and visitors. While some norms are immediately obvious or formally written in an
employee manual, other norms are intricate, compelling a new employee to seek
the advice of or closely watch a veteran employee for cues as to how one should
behave while in the organization.
One norm practiced by outstanding service-focused institutions is to greet a cus-
tomer warmly by smiling and making eye contact. Another norm is the 15-foot
rule, whereby an employee must make positive contact with a customer who is
within a 15-foot radius. This rule applies not only to patients and their family mem-
bers but also to window washers, engineers, the grounds crew, and any other visitor
to the facility or unit. Positive contact includes making eye contact, asking the person
if he or she needs help, or briefy engaging in conversation. These hospitality norms
can enhance the healthcare experience and should be taught to all staff. For example,
employees at Baptist Health Care are instructed to say, May I take you to where you
are going? upon seeing a customer who seems lost or confused.
Cultural norms are defned and molded not only by employees and managers
(including supervisors) but also by customers who make their expectations plain.
Vocal customers are an advantage that healthcare has over manufacturing, in that
product consumers are far removed from the organization and rarely contact the
108 Achieving Service Excellence
manufacturers directly to give feedback. Feedback, comments, and even nonverbal
cues (e.g., glares, silence) from healthcare consumers assist managers in monitor-
ing, reinforcing, and shaping behavior expectations. Exhibit 5.1 presents Baptist
Health Cares behavioral guidelines for nurses; although these norms were created
years ago, they are still useful guides to any healthcare organization seeking to
shape and defne customer-oriented behaviors.
Norms also apply to physical appearance, including clothing and grooming.
Examples of this norm include wearing a clean and ironed uniform, maintain-
ing a specifc hair length and style, wearing gloves when handling patients, and
minimizing jewelry during work hours. Although such norms can be criticized for
restricting the employees freedom of personal expression, they are not baseless. For
example, wearing strong or too much perfume is often prohibited because it can
trigger allergy symptoms and other uncomfortable reactions.
Similarly, looking disheveled and dirty goes against a facilitys message of health,
cleanliness, and well-being. Most important, customers (whether internal or external,
primary or secondary) expect all workers at any healthcare facilityfrom the CEO to
the nurse supervisor to the pharmacy technician to the orderly to the security guard
to appear friendly, caring, professional, credible, and ready to serve. Indeed, one of the
frequent patient complaints is the lack of standardized staff uniforms, which can make
it diffcult to tell the difference between the housekeeping staff and the nursing staff.
This confusion can be frustrating for anxious patients and family looking for help.
Exhibit 5.1 Behavioral Guidelines for Nurse Interactions with Patients
Greet all patients by name and introduce yourself during the initial meeting (all three shifts).
Provide each patient with your pager number and phone number, and invite communication
as needed.
Discuss reasons for each procedure before it is done.
Ask patients if they need anything else before leaving a patient room.
Explain that doors and curtains must be closed to ensure privacy.
Respond promptly to call lights.
Ensure that proper levels of pain medication are available for each patient.
Never talk negatively about patients or coworkers.
Source: Reprinted with permission from Baptist Leadership Institute, Pensacola, Florida. Originally
included in a presentation, Turning Customer Satisfaction into Bottom-Line Results, by Q. Studer and
G. Boylan, July 2000.
Chapter 5: Developing a Culture of Customer Service 109
Folkways and Mores
Folkways and mores are closely related to norms. Folkways are shared practices or
customs within a group. For example, shaking hands is a folkway in the business
setting. Addressing physicians with Dr. before the last name is a folkway in most
societies. In a healthcare organization, regardless of size or mission, one folkway is
for laboratory technicians to wear a white coat.
Mores are proper behaviors that are understood and practiced by the entire
group. Examples in healthcare include wearing gloves, washing hands, and knock-
ing before entering a patients room. Mores, although not necessarily based on
morals, can be fundamental to a code of ethics.
Subcultures
Because they are made up of distinct units and work groups, healthcare organiza-
tions are a breeding ground for many subcultures.
Categorizing staff by employment status (full time versus part time or tem-
porary), department (laboratory versus rehabilitation), specialty (pediatrics versus
intensive care unit), type (administrative versus clinical, managerial versus pro-
fessional, union versus nonunion), length of service (veteran versus newcomer),
or shift (weekday versus weeknight) promotes the formation of subcultures. The
reason is simple: Employees bond with those who are like themselves. For example,
part-time or temporary employees may form a subculture on account of the factors
that tie them togetherfor example, limited communication with full-timers and
administration, limited employment benefts, and irregular hours.
Although subcultures are not necessarily bad, they can be a managerial chal-
lenge if they conict with the overall culture. For example, a subculture of vet-
eran clinicians and managers may clash with the corporate customer service value
because the subculture has a silo mentality, which complicates patient handoffs,
impedes information exchange, and detracts from patient-focused care.
Sometimes, a subculture may be more customer oriented than the dominant
culture. Take, for example, the case at the Northwest Regional Faculty Devel-
opment Center of the Boise VA Medical Center in Idaho. The Center had two
subculturesthe provider and the executive (Smith, Francovich, and Geiselman
2000). The values of these two cultures diverged and, as such, acted as a barrier
to working together. The executives were focused on adding patients when the
Centers clinical capacity was already at the maximum, while the providers were
110 Achieving Service Excellence
ordering expensive patient treatments and interventions that took away funds and
time that could have been used to make the Center more competitive.
When data reecting the plans and actions of each culture were presented to
them in a problem-solving meeting, both groups were able to see the need to fnd
mutually acceptable ways to bridge the gaps in their values with an eye toward
providing both excellent and cost-effective service. A discussion was initiated and
solutions were forwarded, including a tighter coupling between clinic capacity and
patient recruitment. The result was better communication between the two cul-
tures, higher levels of patient satisfaction, and cost savings.
Any time management confronts conicting cultures or subcultures, it must en-
sure that the information that passes between the groups is not distorted, delayed,
limited, or biased by the subcultures norms and values. Recognizing the existence
of subcultures and knowing why they exist will allow managers to encourage col-
laboration among such groups. It will also help different subgroups understand
how their subcultures ft into the overall organization. The ideal outcome is that
the impact of differences will be diminished and collaboration will be enhanced.
Subcultures may develop their own cultural values and beliefs, as long as they do
not interfere with those intended to advance the mission.
Commitment
A healthcare culture requires an especially high level of commitment from its fol-
lowers. Silos and subcultures are common, both of which can weaken the cultural
value of service. Regardless of how ideal the beliefs, values, norms, folkways, and
mores of the culture, the culture cannot be sustained if it is not fully supported by
members of the group. The task of gaining commitment belongs to the leader, and
that is the subject discussed in the next section.
THE ROLE OF LEADERS I N DEFI NI NG AND
TEACHI NG A CUSTOMER- FOCUSED CULTURE
Getting everyoneemployees and contract staff aliketo commit to high levels of
customer service is daunting and takes a great deal of time. This effort should start
at the top with senior leaders, although all managers and supervisors play a part in
translating and disseminating the established culture. Culture signifcantly affects
employees eagerness to serve. Thus, the culture should support employee initiatives,
decisiveness, innovativeness, and rewards related to customer service (Bellou 2007).
Chapter 5: Developing a Culture of Customer Service 111
Senior leaders, because of their high-level and high-visibility positions, must be
role models within the organization. As role models, leaders set the standards of
organizational behavior and infuence the actions of internal stakeholders. This in-
fuence has a cascading effect. A CEOs every move is watched and imitated (even
judged) by other executives in the C-suite. Vice presidents actions set an example
for managers, who in turn affect the behaviors of supervisors, who in turn guide
frontline employees.
In defning and teaching the customer-focused culture, leaders must
1. make a commitment to customer service, embodying that dedication in all
they say, do, and write, and
2. clearly, consistently, and regularly communicate that commitment not only
with words but also through deeds.
The message itself should be intentional and explicit. For example, Marriotts
founder, Bill Marriott, Sr., reportedly fred an employee on the spot for insulting
a guest. After the story spread throughout the organization, employees no longer
doubted that Marriott was serious about its purported culture of putting the cus-
tomer frst at all times.
Leaders who do what they say are viewed as consistent, participative, highly
structured, considerate, and in touch with both staff and customers. They may be
known as demanding, but for a reason: They are willing to do whatever it takes to
develop and motivate staff to provide better service. Their expectations and insis-
tence on results may be high, but the rewards they offer for goal achievements are
equally great, if not more so. Their decisions are consistently based on the cultural
values espoused by the organization (Ford et al. 2006). As a result, employees be-
lieve in the culture and its values, which in turn encourages them to stay with the
organization. The more the employees accept and believe in the culture, the more
likely they will uphold its values in all they do, including how they treat patients,
colleagues, and other stakeholders.
Establishing a culture requires a leader who seeks to transform the organization
and its members by inspiring it with a compelling vision, rather than by focusing
on routine operational transactions. In the literature, vision-driven leadership is
called transformational, while routine management is termed transactional.
Transactional leaders have a place in every organization; after all, someone has to
ensure that the payroll is processed on time and the bills are paid. However, real
change requires transformational leaders. Kouzes and Posner (1995) identify the
fve roles of a transformational leader:
112 Achieving Service Excellence
1. Challenge existing processes and practices to promote innovation and
improvement.
2. Inspire others to share the vision by showing people how their responsibilities
directly contribute to achievement of the mission.
3. Enable and empower others to act.
4. Model the way to achieve the mission.
5. Encourage the heart to give meaning to everyones work.
Interestingly, conceptual and empirical research indicates that these strategies
are commonly used by managers who are seen as spiritual leadersthat is, those
who believe in service to others, humility, and honesty (Strack and Fottler 2002;
Strack, Fottler, and Kilpatrick 2008).
Translating and Practicing the Culture
Managers at all levels are responsible for translating the culture for their direct reports.
Talking about the importance of a customer service culture is not enough; managers
must also walk the talk, so to speak, by using their actions as examples, actively coach-
ing others, and correcting inappropriate behaviors. For example, if a nurse manager
witnesses a nurses aide blatantly ignoring a patients repeated request for an extra blan-
ket, the manager must step in to help and then immediately speak to the aide (or even
to all the staff on the unit) about the importance of providing service to the patients.
If the manager ignores the aides behavior and assumes the incident will not
happen again, the manager is communicating that such behavior is acceptable and
tolerated. After a few instances of the manager looking away from an obvious
disregard for the values and standards, employees will stop listening to the talk.
A major component of translating the culture is putting in place reward systems,
training programs, and measures of achievement that support and reinforce the
message. That is, employees who strengthen the culture are rewarded; organiza-
tional successes are celebrated; and coaching and education in customer service are
an ongoing management practice.
Practicing Patient-Centered Approaches
A culture that honors patients can improve a healthcare organizations reputation
and thus its competitiveness in the marketplace. Following are examples of patient-
centered efforts:
Chapter 5: Developing a Culture of Customer Service 113
World-renowned Planetree is a nonproft collaborative of healthcare
organizations formed to promote the development and implementation of
innovative healthcare models that focus on healing and nurturing the body,
mind, and spirit of the patient.
Planetree (2009) provides education and information about healing
environments and patient-centered care and helps other organizations apply
these principles. Planetrees success and growth demonstrate that patient-
centered care is not only an empowering philosophy but also a viable, cost-
effective approach to care delivery (Frampton and Charmel 2008).
United Healthcare (2009) has partnered with IBM Corporation and selected
physician practices in Arizona to develop patient-centered physician practices.
The goal of this collaboration is to strengthen the patientprimary care
physician relationship using the Patient-Centered Medical Home model. This
model enables physicians to work closely with patients to better understand
patient needs and preferences, coordinate health services, and facilitate
linkages to other healthcare professionals.
In 2004, the Picker Institute sponsored a summit to discuss patient-centered
healthcare reform. Twenty-seven leaders in the patient-centered movement
shared their opinions and forecasts on healthcare reform, noting that patient-
centered care will be the most preferred but the least likely to be enacted.
Whether this 2004 prediction will become a reality in light of the 2009
healthcare reform proposal remains to be seen.
I MPORTANCE OF A CUSTOMER- ORI ENTED CULTURE
Everyone has experienced a place that feels warm, friendly, and helpful. Similarly,
everyone has experienced a place that feels aloof, uncaring, and impersonal. How-
ever, few people can articulate the exact reason they perceived one place welcoming
and the other cold. Fewer people may guess that the difference is the culture.
A customer-focused culture naturally leads to increased patient satisfaction, and
as laid out throughout this book, happy customers are a source of many benefts,
including organizational survival (Jones and Sasser 1995), increased market share
(Rust, Subramanian, and Wells 1992), and proftability (Heskett et al. 1994).
First, patient satisfaction not only enhances the organizations reputation but
also engenders customer loyalty (Hansemark and Albinsson 2004; Platonova,
Kennedy, and Shewchuk 2008). Loyalty translates to repeat business, which in
turn generates income. Second, satisfaction lowers the expenses associated with
attracting new customers, including advertising, promotion, and start-up activi-
114 Achieving Service Excellence
ties (Bellou 2007). Third, satisfaction drives recommendations and referrals from
the patients. Fourth, satisfaction strengthens the organizations competitive edge
(Gelade and Young 2005).
Employees like to work in a customer-oriented organization because they
encounter less customer criticism and abuse, fnd their jobs more fulflling, and
perceive the company to be supportive and trustworthy.
Provides a Competitive Edge
Culture can be a signifcant competitive advantage if it has value to its members,
is unique, and cannot be easily copied. One strategy for creating a culture that
serves as a competitive advantage is to identify and then adopt successful elements
in other organizational cultures. These elements can be altered to ft the realities of
the organization.
Often, a unique culture exudes a fun, relaxed spirit. Patients and their families
prefer this type of atmosphere as it yields many benefts, such as promoting friendly
interactions among employees and between staff and patients (Ford, McLaughlin,
and Newstrom 2004).
Highlights Core Competency
Culture signals the organizations core competencies. The perception is that a cul-
ture that values both high-quality healthcare and patient satisfaction will not make
a move (even if it is cost-saving) that jeopardizes the quality of the service experi-
ence. Most important, this culture will ensure that operational, managerial, and
clinical systems that support excellence are in place.
Bridges the Internal and External Worlds
Culture helps organizational members interact with two core groups: (1) the ex-
ternal environment and (2) other internal members. Ed Schein (1985) describes
culture as a pattern of basic assumptionsinvented, discovered, or developed by
a given group as it learns to cope with its problems of external adaptation and in-
ternal interactionthat has worked well enough to be considered valid and, there-
fore, to be taught to new members as the correct way to perceive, think, and feel in
relation to those problems.
Chapter 5: Developing a Culture of Customer Service 115
Culture helps its members make sense of their internal and external environ-
ments. Some organizations misinterpret the need to deal with the outside world as
the need to adopt an us versus them mind-set. Such a closed culture approach,
however, encourages people to have a negative and unreceptive attitude to ideas
generated outside of their immediate setting. For example, new industry practices
and innovations in other felds are downplayed or deliberately ignored, and inter-
nal methods are kept secret and protected.
On the other hand, organizations with an open culture constantly encourage
growth and development by interacting with other players in the industry, bench-
marking against best practices, and trying novel ideas. Members of such a culture
adapt and respond more quickly to environmental and customer trends.
In addition, a customer-oriented culture establishes extensive standards or rules
for behavior and performance about how to deal with the patient and other external
customers. These guide the interactions among internal members and between these
members and outside customers. As a whole, a customer-focused culture prepares
employees to face the incredible variety of external events, patient expectations, and
other situations and contingencies that can arise in delivering a healthcare experience.
Ideally, these standards are written, not tacitly known. Excellent healthcare organiza-
tions, however, understand that written rules and procedures alone are not enough.
Leaders and managers must invest time clarifying, disseminating, and teaching (even
re-teaching) this information as well as cultural values and beliefs.
Gaps will inevitably occur between what the culture provides and espouses (e.g.,
values, standards, education) and what the external environment presents (e.g., indus-
try requirements, changes in service delivery, governmental policies). In these instances,
people who work in a strong patient-focused culture will adapt more readily while de-
livering the quality of patient experience that the cultural values promote and require.
Reinforces Values
Values are regularly reinforced in exemplary organizations, where leaders invest consid-
erable time and money on educating the workforce about the patient-centric culture.
In these organizations, values are discussed at staff meetings and are often the subject
matter of training sessions. One method of reinforcing values is to hold a staff retreat
focused on building and strengthening a customer service culture. At the retreat, par-
ticipants may be asked to refect on questions such as the following (Eubanks 1991):
Who are our customers?
What do our customers need, want, and expect?
116 Achieving Service Excellence
What values should we support to enable us to deliver these needs, wants, and
expectations?
What human resources practices may nurture our values?
Third-party facilitators (e.g., consultants, professional trainers) are often called
in to help participants differentiate between personal values and institutional val-
ues, and reconcile the two if necessary.
Because every new hire brings some cultural assumptions based on his or her
past experiences, leaders and managers must indoctrinate the employee into the
culture and its values from day one. Quint Studer, former president of Baptist
Health Care in Pensacola, Florida, required all new employees to go through a
day-long orientation program. The orientation covered not only the obvious top-
ics of organizational policies and procedures but also the cultural values of patient
satisfaction and customer service. All employees were expected to remember the
primary importance of customer service in their organizational decision making.
Studer ensured that Baptists mission rested on the clearly defned values of
service, quality, cost, people, and growth. Furthermore, he communicated these
values early and reinforced them at appropriate times.
Aids Self-Management and Decision Making
The stronger the culture, the less necessary it is for employees to rely on the typi-
cal bureaucratic mechanismssuch as policies, procedures, and managerial direc-
tiveswhen making a simple decision about their work and themselves.
For example, a nurse faced by a complaining family member can be trusted to
do the right thing to turn around the customers negative attitude. The nurse
does not need to fnd a manager to resolve the issue. In this sense, the employee is
empowered. This is an important by-product of a customer-centered culture, given
that so many aspects of healthcare happen during direct interactions (or moments
of truth) between the patient and the caregivers (clinical and nonclinical person-
nel) that do not involve an immediate supervisor.
Unlike in the manufacturing business where the products are standardized and
the production process is predictable, in healthcare every experience is unique. As a
result, various types of complications come up for which the healthcare organization
has not established a formal response, protocol, or policy. The more uncertain the
task, the more employees must depend on corporate values to help them make deci-
sions about what to do and how to do it because they cannot rely on previous train-
ing or formal instructions to guide their behavior (Davidow and Uttal 1989, 48).
Chapter 5: Developing a Culture of Customer Service 117
Promotes Patient and Employee Satisfaction
Facilitative management, adequate resources, continuous training, excellent up-
ward and downward communications, teamwork, aligned goals, and rewards are
the hallmarks of a culture that involves its employees. Called a high-involvement
work environment, this culture has been shown to improve service quality, patient
satisfaction, and customer loyalty (Scotti et al. 2007). Furthermore, it results in
greater employee satisfaction, which has been known to contribute to enhanced
customer perceptions about the care they received. Various studies indicate that
employee satisfaction is signifcantly linked to patient satisfaction (Atkins, Mar-
shall, and Javalgi 1996; Corvino 2005; Leggitt, Potrepka, and Kukolja 2003), posi-
tive clinical outcomes (Leggitt, Potrepka, and Kukolja 2003), and greater market
share (Zimmer, Zimmerman, and Lund 1997).
COMMUNI CATI NG THE CULTURE
When customers lack the expertise to judge an organizations offerings, they turn
into detectives, scrutinizing people, facilities, and processes for evidence of quality.
When the service product is a healthcare experience, the patient becomes especially
sensitive to every cue and clue about the healthcare provider. In other words, when
no physical or tangible product can be seen and the clinical outcome cannot be
experienced until after it occurs, the patient looks at everything and everyone in
the environment to get an indication of how good the experience will be.
A healthcare organization should take every opportunity to leverage its cultural
values through its laws and language; stories, legends, and heroes; symbols and
rituals; and brand to communicate its customer orientation. This responsibility
falls on leaders and managers. As Davidow and Uttal (1989) point out, Leaders
who take culture seriously are bears for internal marketing, selling their points of
view to the organization much as they would sell a product or service to the public,
with slogans, advertisements, promotions, and public relations campaigns. The
largest single chunk of their time is spent communicating values.
Laws and Language
Every organization has lawswritten rules, policies, and standards related to health
and safety, human resources, clinical practices, and so on. These laws are based on
larger governmental and industry regulations, and they detail the consequences of
118 Achieving Service Excellence
violations and deviations. An example of a healthcare organization law is the policy
on safe disposal of hazardous medical waste.
Organizational language is the set of special terms or jargon used by insiders.
This language is a type of shorthand that only members of the group can under-
stand or follow, and as such it reaffrms that a person belongs (or does not belong)
in the culture. For example, an emergency department doctor may say, Palpate the
axilla, and check for idiopathic pediculosis. Although this direction is in English,
it may not be comprehensible to those not trained in medicine.
A common criticism from healthcare consumers is that healthcare personnel do
not speak plain English, making them hard to understand. The same feedback is
often given about brochures and other clinical literature. These customers have a
valid point. A truly customer-focused culture ensures that organizational laws and
language are as clear and simple as possible for the beneft of patients, families, and
those without a clinical background.
Stories, Legends, and Heroes
In healthcare, stories, legends, and heroes abound. Leaders and managers can com-
municate the culture and its values through storytelling and highlighting the feats
of people (employees and nonemployees alike) who have made remarkable con-
tributions to the organization. These stories should be preserved and used at op-
portune times.
Most people love stories, and most people are more receptive to learning when
the lesson is illustrated by examples, cases, and stories, not by dry concepts or
theories. Lessons are more memorable this way, and employees are more inspired
to apply the learning in various situations.
Here are two customer-related stories we obtained through our focus groups.
We share them here not only to inspire and reinforce a customer service value but
also to illustrate that such stories can be retold and embellished, if necessary, to
urge improvement and guide behavior.
1. A nursing home resident, depressed and sullen, is refusing to eat. A nurses
aide is bothered by the situation and begins to look for a solution. The aide
fnds out that the resident is partial to peanut butter milkshakes. So the aide
learns how to make the shake and prepares it for the resident. The resident is
touched by this gesture and shows interest in eating again.
2. A nurse notices that a patient who just had a second leg amputation is
extremely depressed. The nurse starts a conversation with the patient, and the
Chapter 5: Developing a Culture of Customer Service 119
patient reveals that he is divorced and lives alone with his dog. Even though
hospital rules prohibit animals (other than guide dogs) from entering the
facility, the nurse arranges for the patients dog to be brought in for a visit.
The patient is overjoyed at the sight of his dog, and he is overwhelmed by
the thoughtfulness and kindness of the nurse. The patient writes a letter to
the hospital administrator, praising and thanking the nurse and other staff
members. The patient has become an evangelist for the hospital, speaking
enthusiastically about his experience at every opportunity.
The moral of these stories is simple: Telling an amazing story that employees
can relate to can go a long way toward inuencing good behavior, motivating bet-
ter performance, and communicating the culture. For customers, such a story is an
invitation to try the organizations services.
Symbols and Rituals
Symbols are physical objects or representations that convey an unspoken message.
Examples of power symbols in the business setting include a large corner offce
with an administrative assistant at the door or a covered, personal parking space
next to the entrance. In healthcare delivery, white coats and scrubs are the com-
mon symbols of a clean, germ-free environment. In healthcare management, offce
size and location are indicators of importance. For example, if a vice president
who oversees customer service has a nicely appointed offce, the message is the
organization views service as a priority on par with other pressing demands (such
as fnances).
Rituals are symbolic acts performed to gain and maintain support of the culture
and to remind group members of the cultures importance. In the service industry,
including healthcare, a common ritual is to celebrate the achievement of milestones
and goals. For example, if a nurse supervisor receives a letter from a patient about
the wonderful job a nurse has done during her hospitalization, the supervisor may
hold a quick unit-staff gathering to publicly acknowledge the nurses performance.
By doing this ritual, the supervisor is reminding all staff of the behaviors and values
that should be practiced in daily interactions with patients.
Many healthcare organizations host elaborate rituals to acknowledge and cele brate
service excellence. These rituals range from departmental pizza lunches to all-staff award
galas. Such ceremonies communicate to members that the organization is paying at-
tention to and is appreciative of accomplished goals. Ultimately, what the organization
120 Achieving Service Excellence
celebrates and rewards says a lot about what it values and believes. If it values customer
service, it must celebrate and reward excellence frequently and enthusiastically.
Branding
The Mayo Clinics powerful brand is based on its motto: The needs of the patient
come frst. From the way it selects and trains employees to the way it designs its
facilities to the way it uses care approaches, the Mayo Clinic delivers concrete evi-
dence of its cultural strengths and values (Berry and Bendapudi 2003). Mayo built
and hones its brand by systematically hiring people who share and/or support the
corporate values. Incentives and rewards are in place to encourage collaborative,
high-quality care. The design of the physical environment is intended to have a
positive effect on the patient experience (Berry and Bendapudi 2003). All of these
strategies communicate patient frst.
Be aware, however, that even a solid brand will not take much to tarnish. As
mentioned before, just one dissatisfed customer can swiftly ruin a good image,
especially in the days of the Internet and social media.
Guth and Deems (2008a; 2008b) suggest these practical approaches to taking a
customer service brand to a higher level:
Offer comfort items, such as blankets, pillows, and headsets.
Ask patients their preferences on service delivery, such as whether they like
conversation or quiet during treatment. If conversation is chosen, the focus
should be on the patient, not the caregiver. Preferences on whether music (and
what type) should be played should also be broached.
Place cloth (not paper) towels and good-quality soap in clean
restrooms/bathrooms.
Make basic beverages available, such as bottled water, tea, and coffee, in
waiting or reception areas.
Smile and be courteous at all times.
TEACHI NG THE CULTURE
As mentioned throughout this chapter, teaching and reinforcing the culture are criti-
cal responsibilities of leaders and managers. Schein (1985, 9) posits that the only role
of real importance to leaders should be to create and maintain the organizations
culture.
Chapter 5: Developing a Culture of Customer Service 121
Following are strategies and examples from organizations with a thriving cus-
tomer service culture. These methods may help a manager become more effective
in teaching the service-focused culture.
Scripting is a form of preparing employees to verbally respond to various
scenarios common in their feld of practice. Exhibits 5.2 and 5.3 offer timeless
scripts that guide healthcare staff s interactions with patients and other
customers. Scripts give staff a way to interact with and serve customers at a
consistently high level.
Bill Marriott Jr., is a constant teacher, preacher, and reinforcer of the
Marriott Hotels cultural values of guest service. He has logged millions of
miles to visit Marriott operations worldwide and to spread the companys
message (Albrecht 1988). His intense commitment to making personal
contact with each and every Marriott employee is well known, and his mere
presence on any Marriott property is a reminder to staff of the companys
commitment to service quality. Bill Marriott demonstrates a focused eye
for detail, even getting involved in the way his hotels are kept clean (Grugal
2002).
In 1999, Greenwich Hospital in Connecticut initiated across-the-board
changes that empower employees to do whatever is necessary to meet and
Exhibit 5.2 Housewide Scripts for Reinforcing the Culture of Customer Service*
Im sorry. Clearly we did not meet your expectations.
You will receive a survey from us in the next few days. Please complete and return it, as your
feedback is very important to us. If for any reason you cannot grade us very good, please
contact __________ .
Is there anything else I can do for you? I have time.
May I take you where you are going?
I am closing the door (or pulling this curtain) because I am concerned with your privacy.
Im concerned about your comfort level. On every shift we will be asking you to measure
your pain level.
*Only three or four housewide scripts were introduced originally. Others were introduced incrementally
over time as associates became comfortable with the concept.
Source: Reprinted with permission from Baptist Leadership Institute, Pensacola, Florida. Originally
included in a presentation, Turning Customer Satisfaction into Bottom-Line Results, by Q. Studer and
G. Boylan, July 2000.
122 Achieving Service Excellence
Exhibit 5.3 Staff-Specic Scripts for Reinforcing a Culture of Customer Service
Position: Radiology technician
Script: We have purchased a blanket warmer, and I am putting a warm blanket around you. We
are concerned about your comfort.
Position: Chaplain
Script: We are also aware that you may have spiritual concerns. We do have chaplains here
around the clock.
Position: Parking attendant
Script: We will be asking you throughout your stay how we can do things better. Let me remind
you that we do have valet parking for the convenience of you or your visitors.
Position: Department unit coordinator
Script: How may your nurse help you?
Position: Lab staff
Script: In the lab, we have done a study and looked at the best techniques and needles to draw
blood. I understand that this procedure may not be pleasant, but I am using the best techniques
and sharpest needles available, so hopefully, this will not bother you too much.
Position: Nursing staff
Script: Your physician cares about you very much, and he has asked that we get a blood sample
very early so the results can be posted on the chart by the time he makes rounds in the morning.
Script: Hello, my name is _________ . I will be your nurse until _________ . Please let me
know the moment we can do something better. My goal is to exceed your expectations and
provide you with very good care. Any questions at any time, please let us know.
Position: Nurse leader
Script: Good morning, my name is _________ . I am the nurse leader on this unit. I want to
assure you that we will do everything possible to exceed your expectations. I need your help. . . .
This is my pager number and my phone number. Please call me the moment you fnd something
we can do better, or let me know of an opportunity where we can exceed your expectations. Our
goal is to provide you with very good care.
Source: Reprinted with permission from Baptist Leadership Institute, Pensacola, Florida. Originally
included in a presentation, Turning Customer Satisfaction into Bottom-Line Results, by Q. Studer and
G. Boylan, July 2000.
Chapter 5: Developing a Culture of Customer Service 123
exceed customer expectations. Various workshops, incentives, and tools
were provided to push the initiative forward (Corvino 2005). The campaign
hinged on seven standards of service excellence, including treating people as
guests, respecting privacy and confdentiality, listening and acting promptly
to address concerns, and maintaining a safe and clean environment. The
results were phenomenal: Greenwich Hospital scored in the top 1 percent
of hospitals nationally in inpatient satisfaction in 16 straight quarters, and
employee satisfaction levels were at an all-time high at the 99th percentile
(Corvino 2005).
Herb Kelleher, former CEO of Southwest Airlines, set an example for the
next generation of Southwest workers. Kelleher used to walk through airports,
Southwest airplanes, and Southwest service areas to show employees that he
cared about the quality of each customers experience. Today, this tradition
lives on. All Southwest managers are expected to observe and work in
customer-contact areas for a given time.
New York Presbyterian Hospital launched a Six Sigma initiative in 2003
to enhance patient, physician, and employee satisfaction. Employees were
given training on the Six Sigma methodology, and a chief learning offcer
was appointed. Among the projects undertaken were inventory management,
patient ow improvement, reduction of length of stay, and employee
recruitment. This effort not only enhanced patient satisfaction but also
garnered an American Hospital Association Quest for Quality prize in 2005
(Craven et al. 2006).
Mission and Vision Statements
The importance of customer service must be incorporated into the mission
and vision statements. These written documents are visible representations of
the organizations purpose and beliefs, and as such they are natural educational
materials. Unfortunately, for some institutions, these statements are merely
sayings. However, for a customer-centered organization, the mission and vi-
sion are carefully used to ensure that everything it says and does is aligned with
the mission. Thus, as noted in Chapter 3, the institutions strategy, staffng,
and systems should be made consistent with the mission.
124 Achieving Service Excellence
Human Resources System
Human resource management should support a customer-focused culture. Job
advertisements, descriptions, and interviews should reect the customer service
commitment of the organization (Crotts, Dickson, and Ford 2005). Beyond the
recruitment and selection processes, orientation and training programs should also
incorporate this cultural value. Senior leaders should be present at these sessions to
add credibility to the effort and emphasize the importance of service excellence.
Once hired and acculturated, employees must be empowered to address and
resolve patient complaints; afterward, they should be recognized and rewarded for
doing so (Scotti et al. 2007). Research supports the argument that healthcare work-
ers, by virtue of their frequent and close contact with patients, are reliable sources
of insight into the needs, wants, and expectations of customers. Managers should
acknowledge this reality and survey frontline staff to fnd out their perceptions
about patient expectations and level of satisfaction (Fottler et al. 2006).
Customer Contact
Benchmark healthcare organizations fully understand and accept a basic truth:
Patients are the sole reason healthcare institutions exist. For these organizations,
investing time, money, staff, and other resources in patient care and satisfaction is
the mode of operations, not just a corporate slogan. To this end, the leaders and
managers build customer-contact time into their schedules, performing patient
rounds and talking directly to patients and families to ask about their needs. All
these hands-on activities serve as a model of behavior (and hence education) for
the rest of the staff, and they communicate to the patients that everyone, even the
senior executives, is committed to patient care and satisfaction.
CHANGI NG THE CULTURE
The culture must change with the times. For example, 30 years ago, the culture
may have favored clinician needs over patient needs on account of the societal
demands and industry standards at the time. That same culture cannot thrive in
todays consumer-driven climate.
However, a fundamentally solid culture does not require a complete overhaul.
The tools that allow a leader to create a culture in the frst place are the same
tools that allow a leader to change that culture. Communication tools (e.g., stories,
Chapter 5: Developing a Culture of Customer Service 125
legends, heroes) and human resources mechanisms that support customer service
values may be used, while other cultural components, such as rituals, can be altered
to ft changed circumstances.
A more arduous task is rebuilding a culture that has never been service oriented
or has long ignored patient satisfaction (see sidebar for examples).
SIDEBAR: CULTURE CONVERSIONS
Baptist Health Care, Pensacola, Florida
In 1995, Quint Studer was appointed president
of Baptist Hospital. When he arrived, the hos-
pital was saddled with low patient satisfaction
(close to the bottom in national surveys), high
employee turnover, low employee morale, nega-
tive perception in the community, and a scal
decit. Studer knew that the hospitals survival
depended on a massive cultural transformation
(Studer and Boylan 2000).
Multiple large-scale initiatives were set in
motion to boost employee morale, patient sat-
isfaction, and occupancy rates; to minimize
employee turnover; and to restore nancial
stability. Ambitious but measurable goals were
set, and individuals were held responsible for
attaining results. The transformation was suc-
cessful, turning Baptist into a patient-centered
organization. Studer (2007) notes that the key to
sustaining service excellence is to embed values
into the culture and key processes.
These nine principles were central to the
transformation efforts at Baptist, but they can
be applied to any attempt at culture building
(Studer 2007):
1. Commit to excellence: Focus on measurable
goals of excellence.
2. Measure the important things: What gets
measured, gets focused on.
3. Build a culture around service: Use tools
and techniques to drive performance.
4. Create and develop leaders: They are the
ag bearers for any effort to achieve
excellence.
5. Focus on employee satisfaction: The best
barometers of problems are employees.
6. Build individual accountability: Create
ownership with employees.
7. Align behaviors with goals and values:
Leaders must be accountable for cultural
change.
8. Communicate at all levels: Learn how to
position others well.
9. Recognize and reward success: Behaviors
that are acknowledged get repeated.
Tallahassee Memorial HealthCare (formerly
Tallahassee Memorial Regional Medical
Center), Tallahassee, Florida
In 1988, Duncan Moore began his new post as
president and CEO of Tallahassee Memorial
Regional Medical Center with a vision of the
ideal hospital. At that time, each member of
the executive team had a different expectation
from and denition of the hospitals mission
statement. With his teams participation, Moore
developed a new mission statement and imple-
mented an organization-wide change. Following
are the strategies used in this process (Brinker
and Phillips 1996):
1. Reach consensus on and ensure a clear
recognition of a new mission focused on
cost-effective customer service.
(continued)
126 Achieving Service Excellence
CONCLUSI ON
Excellent leaders constantly and consistently display a personal commitment to the
culture of customer service through their actions and words. They recognize the
importance of serving as a role model for the rest of the organization. They realize
that everything they do (or dont do), everything they praise (or dont praise), and
everything they reward (or dont reward) is noted and emulated by staff across the
organization. They give meaning to their organizations mission and values. They
stress regular, two-way communication with all internal and external stakehold-
ers, and they encourage and reward behaviors that reinforce the customer-focused
culture.
A leader has many responsibilities, but perhaps the most important of these is
defning and teaching the customer service culture.
SIDEBAR (continued)
2. Develop a vision statement that can be
easily transmitted to staff and with which
staff can identify.
3. Ask key staff members in each unit to
visualize what their unit or service would
look like if it disappeared overnight and if
they had abundant resources to rebuild
and reorganize it.
4. Assess the current conditions within
the unit or service, including such factors
as physician satisfaction levels, stafng
mix, adequacy of supplies, and
paperwork.
5. Superimpose the assessment of actual
conditions on the ideal vision to identify
gaps or areas in which change must
occur for the unit or service to become
the ideal.
6. Prioritize the changes cited in each area
based on their relative importance,
potential impact on patient satisfaction,
and potential cost savings.
The hospital followed two basic implemen-
tation rules. First, all teams had to include
members of stakeholder groups affected by the
change. A manager, a supervisor, and direct re-
ports rounded out the composition of the teams.
Second, all plans had to state what means and
resources would be used to accomplish the par-
ticular plan.
To maximize the impact of the interactive
planning and management process and to pro-
mote an awareness of the mission and values
among employees, the hospital provided educa-
tion, communications, and rewards. For exam-
ple, team members received intensive training
in systems thinking, management styles, and
systems model analysis (Brinker and Phillips
1996).
Moore (who retired from the hospital in
2003) has stated that a positive culture is per-
sonally enriching for employees and not too ex-
pensive to achieve and maintain.
Chapter 5: Developing a Culture of Customer Service 127
Service Strategies
1. Integrate beliefs and values into every aspect of the employee/human
resources management system, including recruitment, selection,
performance appraisal, and rewards and compensation.
2. Develop customer-focused beliefs and values by actively involving
employees in customer initiatives; coaching, training, and empowering
employees; decentralizing decision making; and communicating with all
staff.
3. Defne and teach the culture by making a personal commitment to
customer service. Regularly show this dedication with words and deeds.
4. Create reward systems, training programs, and measures of achievement
that support and reinforce the customer-oriented culture.
5. Identify and adapt successful elements from other organizational cultures.
Alter these elements to ft the realities of your own environment.
6. Interact with the outside world to promote an open culture that is receptive
to new ideas and prepared for as many new challenges as possible.
7. Share stories of organizational legends and heroes to educate employees
about the culture, reinforce the values, and inspire better performance and
goal achievement.
8. Celebrate and reward excellent customer-oriented performance and
behavior.
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P A R T I I
The Service Staff
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131
There is a shortage of healthcare professionals across the country, as well as a shortage
of registered nurses, that is compromising patient care. This shortage will
reach crisis proportions in the twenty-frst century.
Kenneth Brownson and Raymond Harriman
C H A P T E R 6
Stafng for Customer Service
Service Principle:
Find and hire clinically competent people who love to serve
A father and his small children rush to the emergency department (ED) to see
the childrens mother. The mother has been critically injured in an automobile ac-
cident, and the prognosis is grave. Hospital rules, however, prohibit visitors under
age 12 to enter the ED. An ED nurse, seeing the familys grief and knowing the
dire condition their loved one is in, escorts them inside to the mothers room.
Clearly, the nurse is breaking the rules. What sets her defant behavior apart
from blatant disregard of the rules is that it adds value to the familys experience.
The family will always remember and appreciate this nurse (and by extension the
hospital), regardless of their loved ones ultimate outcome.
Skilled, experienced, and thoughtful employees, such as this ED nurse, make a
tremendous contribution to enhancing the healthcare experience. Because so many
gray areas exist in healthcare delivery, leaders and managers should allow and en-
courage their staff to rely on their intelligence, training, and creativity, rather than
to strictly abide by the rules, to resolve service-related issues. In this way, employees
are empowered, which in turn motivates them to provide an outstanding service
experience. (However, clinical protocols must be followed every single time, given
that those standards are established to prevent adverse medical events.)
A healthcare organization that recognizes and applies the knowledge and capa-
bilities of its human resources sends a signifcant message within and outside its
walls: We trust our employees to do the right things for our patients. This percep-
tion can be leveraged as part of a retention and recruitment strategy, especially for
132 Achieving Service Excellence
people who entered the healthcare feld with the primary intention of caring for
patients. Feeling empowered to resolve service complaints without a managers in-
volvement is a reward by itself and can promote staff retention.
In this chapter, we address the following:
All aspects of staffng a customer-focused culture
The contributions of employees who are empowered to provide great service
The challenges of building a pool of skilled and talented job applicants
The concepts of job analysis and personorganization ft
Approaches to retention and selection
CONTRI BUTI ONS OF EMPLOYEES TO A
CUSTOMER- FOCUSED ORGANI ZATI ON
Much of the success of the service strategy hinges on the people who will imple-
ment the plans or do the actual work. To this end, new employees must be carefully
recruited and selected for their service orientation, and existing staff who exhibit
preference for and comfort with providing service must be retained.
Staff empowerment is critical. Employees who are given service training and are
rewarded, encouraged, and appreciated for their service contributions should feel
empowered to provide superior care. Such employees bring many advantages to the
workplace, including the following:
1. They make the healthcare experience memorable for patients and their
families. As a result, the organization is at the top of the patients mind in a
positive way and is likely to be recommended to others and to see the patient
for a return visit if a healthcare need arises.
2. They represent the organizations competitive advantage. Plans and strategies
may be duplicated, but empowered employees personal commitment to high-
quality service is unique and hence cannot be easily cloned.
3. They love what they do and thus tend to stay on the job. This high retention
rate then attracts other service-minded workers.
When staff are insuffcient in numbers, poorly trained, or poorly motivated, the
gap widens between what customers expect and what customers receive. One Gal-
lup study showed that 59 percent of employees are not engaged and 14 percent
are actively disengaged (Gallup Management Journal 2006). Obviously, health-
care executives want more from their staff than simply being physically present;
Chapter 6: Stafng for Customer Service 133
they also want staff to be highly involved, motivated, and committed while on
the job.
Health Professions Shortages
Recruitment and retention of healthcare professionals are important in the face of
continuing shortages in key healthcare professions, including primary care physi-
cians, nurses, and allied health professionals.
As noted elsewhere in the book, todays medical students choose to enter medi-
cal specialties rather than primary care because insurance reimbursement rates are
higher and working conditions tend to be better in a specialty practice. As a conse-
quence, retired/retiring primary care physicians are not being replaced by an equal
or greater number of new primary care doctors. Compounding the shortage prob-
lem is the additional administrative burden on existing primary care physicians. As
gatekeepers, these doctors have to coordinate patients, which is a challenging task
in a time-stressed environment.
The American Hospital Association (2007) reported an average hospital nurse
vacancy rate of 8.1 percent. This vacancy rate is related to an RN (registered nurse)
shortage, which is estimated to be in the range of 340,0001 million nurses by
2020 (Auerbach, Buerhaus, and Staiger 2007; HRSA 2006b).
Unruh and Fottler (2005) report data that suggest a more imminent and stron-
ger decline in RN supply than initially projected by the U.S. Department of Health
and Human Services. Their analysis documents recent gains and losses in the RN
license pool; a decline in RNs working or looking for work in nursing; and a shift
in RN supply from bedside nursing.
Nearly 17 percent of RNs were not employed in nursing in 2004, which was a
26.2 percent increase over the 1992 rate (HRSA 2006a). In one survey, 55 percent
of nurses reported their intention to retire between 2011 and 2020 (AACN 2007),
which would further contribute to the RN shortage.
Similarly, the American Hospital Association (2007) reported 6 percent to 11
percent vacancy rates among allied health professionals (e.g., occupational and
physical therapists, laboratory technologists, imaging technicians). These shortages
require current professionals to treat more patients and to work longer hours. Such
conditions can contribute to emergency department diversions, increased patient
wait times, decreased patient safety, and lower patient satisfaction.
These statistics raise a truth: If fnding qualifed clinical employees is diffcult,
fnding qualifed and patient-focused clinical employees is even more diffcult.
134 Achieving Service Excellence
Health professional shortages will force healthcare managers to work even harder
at building a qualifed and service-loving pool of candidates.
Service Lovers
Outstanding healthcare employees can easily be distinguished from the merely
clinically competent. In his book Positively Outrageous Service, author Scott Gross
(2004) calls such people lovers because they love to provide great service. In
healthcare, these are the employees who connect with patients and build a relation-
ship that make patients feel good about their healthcare experience. Although the
relationship may be brief, it makes the patient believe that something is special and
memorable about his total healthcare experience.
Gross estimates that people who love to serve others represent only one in ten
of the available workforce: Ten percent cant get enough of their customers. Five
percent want to be left alone. When it comes to customers, the vast majority can
take em or leave em (Gross 2004). If Grosss percentages apply to the health pro-
fessions, he raises two major challenges for healthcare managers:
1. Work hard to develop a process that will systematically fnd, recruit, and
select those 10 percent of the clinically competent who are truly committed to
providing excellent service.
2. Work even harder to develop an effective process for showing the rest how
to provide the same quality of service that the lovers do naturally. Because
naturally talented people are so rare in the labor pool, the organization must
identify what service skills are lacking in the people hired and then train them
in those skills.
Given the challenges of recruiting and hiring good employees in the healthcare
industry, some organizations are tempted to place the lovers in the patient-contact
jobs and hire the rest for support jobs that do not have direct contact with the
patient. Because not all jobs in healthcare organizations require extensive patient
contact, putting people who are not naturally good at service in these behind-the-
scenes jobs may seem like a way out.
Excellent organizations, however, recognize the fallacy of this reasoning. They
know that all employees are involved in serving customers (whether patients or co-
workers). Knowing that service effectiveness depends on people in the organization
taking their service responsibilities seriously drives great institutions to hire only
candidates who are capable and have the willingness to provide outstanding ser-
Chapter 6: Stafng for Customer Service 135
vice. Even the accountants must be sensitive to the needs and expectations of their
customerstheir colleagues. A hiding place does not exist anymore for those who
may be outstanding technically or clinically but who have no service skills.
Jeffrey Pfeffer, a Stanford professor, conducted an extensive review of high-
performance organizations in 1998. His examination yielded seven human resources
management practices that are still relevant today. One of the seven practices is se-
lective hiring. For healthcare organizations that wish to be customer focused, this
practice means they need to identify staff traits that are related to customer service
and then recruit and select the best. Although many healthcare organizations try
to select the best and train the rest, benchmark organizations have gained a com-
petitive edge by developing recruitment, training, and placement programs that
motivate all employees to provide outstanding service to both external and internal
customers. If the organization is somehow able to attract and select the best poten-
tial employees, it will gain a signifcant advantage over its competitors that do not
systematically seek out and fnd these service-focused people.
J OB ANALYSI S PROCESS
Job Analysis
Selecting the best person for the job should begin with a job evaluation. A careful,
thorough job analysis allows the organization to identify the exact job specifca-
tions and required competencies for each job classifcation and type. A job analysis
will reveal if you need physically strong people to assist patients in orthopedic
rehabilitation, skilled nurses to monitor surgical patients, or multilingual people to
speak to/translate for non-English-speaking patients.
The job analysis process generates two documents: (1) job description and (2)
job specifcation. The job description outlines the duties and responsibilities of
the position, while the job specifcation details the educational, experience, skills,
knowledge, abilities, and personal requirements for the position. Sometimes, these
two items are combined into one document.
Knowledge, Skills, and Abilities
Evaluating the job enables the organization to deduce the knowledge, skills, and
abilities (KSAs) necessary to perform that job. Many organizations spend consid-
erable sums of money identifying the KSAs associated with each major job or job
136 Achieving Service Excellence
category and then developing tests to measure the degree to which the applicants
possess these KSAs. If this measurement process is done properly, and if the tests
have been shown to be both valid and reliable, the organization has an effective and
legally defensible means for putting the right candidates in the right jobs. Further-
more, by conducting a careful job analysis, the organization gets the added beneft
of identifying training needs and building reward structures that are directly re-
lated to the critical KSAs for a job.
Measuring the technical competencies necessary to serve patients is easier than
measuring friendliness, ability to stay calm when criticized by customers, profes-
sionalism, self-esteem, integrity, accountability, and willingness to helpall of
which are necessary for excellent customer service. Even so, the organization must
assess the attitudes and values of job candidates, not just their job skills. Because
skills can be taught and learned more easily and readily than attitudes and values,
new staffers must come in with a caring attitude. From the patients perspective,
the signifcance of staff attitude is expressed in the healthcare saying Patients dont
care how much you know until they know how much you care.
Staff Competence
According to The Joint Commissions (2007) publication Assessing Hospital Staff
Competence,
Ensuring the competence of individuals who work in all hospital areas
is key to providing quality patient care and ensuring patient safety.
Hospitals can achieve this goal through competence assessment, a
process that involves using performance appraisal, credentials review,
and privileging activities to evaluate and verify a persons capability of
meeting job expectations.
The focus of The Joint Commissions competence framework is the employees
job skill and knowledge, not customer service ability or orientation. Thus, this
framework does not assess staff s competency in providing excellent service.
A sound customer-focused model requires the management team of the hospi-
tal or department to defne the customers, desired customer outcomes, and indi-
cators of achievement for all outcomes. Generic core competencies in the area of
behavior are defned for all employees, as are job-specifc competencies in the area
of customer service. Obviously, competencies cannot be determined without frst
defning superior performance. In the current market-driven healthcare economy,
Chapter 6: Stafng for Customer Service 137
the outcome desires of both customers and healthcare professionals should be the
standards of superior performance.
Competencies are characteristics that are causally related to effective or supe-
rior performance on a job. Pruitt and Epping-Jordan (2005) propose fve areas of
competencies:
1. Patient-centered care
2. Partnering
3. Quality improvement
4. Information and communication technology
5. Public health perspective
Obviously, the competency of patient-centered care is related to customer ser-
vice. However, this area is too amorphous to serve as a guideline for fnding can-
didates with a customer orientation. More specifc customer-related skills, knowl-
edge, and abilities should be sought.
Customer service problems and most management problems revolve around the
hidden competencies, such as service orientation. This is not surprising given the his-
torical emphasis on hiring staff for their KSAs and the fact that license and performance
appraisal systems are based on task performance rather than customer outcomes. Com-
petence cannot be determined without connecting customers outcome expectations to
worker characteristics such as motivation, interpersonal skills, and political skills.
Because motive, trait, and self-concept competencies are more diffcult and ex-
pensive to assess and develop than knowledge and skills competencies, selecting a
job candidate with these hidden competencies is more cost effective than cultivat-
ing these skills in the person after she has been hired.
Many possible clusters of obvious and hidden competencies can be developed,
and Decker (1999) proposes the following:
Customer service/communication
Professionalism
Decision making/problem solving
Resilience
Cost control
Political/system awareness
Support for the organizations values and goals
Decker (1999) identifes the following customer service/communication skills
and competencies for benchmark healthcare organizations:
138 Achieving Service Excellence
Speaks courteously to customers
Offers and accepts constructive criticism
Practices active listening
Writes legibly
Provides and asks for feedback to confrm understanding
Maintains eye contact when speaking to someone
Provides timely and clear information and follow-up to requests from patients
and other customers
Identifes self to all customers at all times
Answers phone in four rings and identifes service and self
Offers assistance without being prompted
Helps maintain a quiet environment
Is not involved in private conversations in front of patients or other customers
Asks permission to put caller on hold and returns in one minute or less
Does not complain to customers
Listens to and educates customers
Treats everyone as an individual
Does not talk down to others
Addresses issues directly with the person involved in a calm tone of voice
Greets people with a smile
Focuses on customers needs
Shows dignity and respect for patients
RECRUI TMENT PROCESS
Internal Candidates
Managers can fll jobs by recruiting from either inside or outside the organization.
Most organizations prefer inside recruitment, if suitable internal candidates are
available. The reason for this preference is that internal candidates have already
demonstrated at least a moderate level of personorganization ft by staying and
applying for the open position.
Simply, the internal candidate is a known quantity. Her everyday performance is
displayed for observation and evaluation, and her strengths and weaknesses have been
tested and are familiar to those with whom she works closely. These are true traits
and talents that are diffcult to assess in a job interview, as candidates may veil in-
formation to impress the interviewer. Even more important, the internal candidate
has shown organizational loyalty by virtue of her ongoing employment and her
Chapter 6: Stafng for Customer Service 139
desire to continue her tenure in the organization. In addition, assuming that the
internal candidate is in good job standing, she has proven that she can interact well
with the organizations customers, a valuable skill in healthcare, where building
and maintaining relationships are critical.
If the job is managerial or supervisory, the internal candidate also has an ad-
vantage over the external applicant because she has performed the tasks and has
worked with people on the unit, making her a natural contender for the position.
Until a managerial candidate has experienced the hectic pace of healthcare work,
felt the pressure of patient complaints, and resolved patient and staff problems on
the spot, the candidate cannot understand what the job entails or be able to lead
those who perform the work day in and day out. The internal candidate can def-
nitely relate to these experiences. Although healthcare experiences acquired from
employment at a different organization can be applied to the scenarios in another
organization, they pale in comparison with the ones that occurred within the em-
ploying institution.
Cultural Compatibility
Internal candidates know the cultures beliefs and values and have proven them-
selves comfortable with them. The cultural learning curve for internal hires is sub-
stantially low. External hires, on the other hand, need a lot of cultural guidance in
the beginning, as they get acclimated to what the organization expects and how
things are done. As service expert Len Berry (1999, 45) puts it, excellent companies
hire entry-level people who share the companys values and, based on performance
and leadership potential, promote them into positions of greater responsibility.
Church-based healthcare organizations promote people from within because
these people often share the same religious values. For example, Baptist Health
System in Birmingham, Alabama, gives preference to internal candidates who have
demonstrated that they live the mission. Another example is the Adventist Sys-
tem in Orlando, Florida, which also strives to select and promote job candidates
who agree to live that systems Christian mission. Although internal candidates do
not have to be members of a particular religious denomination, they must demon-
strate by their behavior that they buy into the organizations value of Christian
service.
Internal Search Strategies
A pool of internal candidates can be built in several ways. Many organizations use
their intranet, staff newsletters, and other internal communication means to an-
nounce job opportunities throughout the organization. Most large hospital chains
have an electronic version of a traditional job board that enables internal job seekers
140 Achieving Service Excellence
to scroll through a comprehensive and searchable job database and apply electroni-
cally. When a facility within the system has a vacancy, the hiring manager can post
the vacancy on the systems intranet, and interested staff may respond by posting
their qualifcations, resumes, and other related material on the same site.
For example, a nurse manager is looking for a licensed practical nurse (LPN)
who is geographically nearby, has fve years of experience, and is a graduate of
an accredited LPN program. The online job database generates a list of the top
internal, eligible candidates, ranked according to the nurse managers criteria.
The manager then contacts the available candidates to explore the employment
opportunity.
Online or electronic internal job boards have grown more sophisticated. Such
systems not only provide real-time information, but they also can be set up to
interface with college/university placement services, government job sites or pro-
grams, and industry hotlines. In this way, job seekers can identify opportunities
with a one-stop-shop approach.
External Candidates
Not every job can be flled by an internal candidate, and organizations do not
always opt to promote from within. External candidates are desirable when the
particular competency needed for a vacant job is not possessed by existing employ-
ees or when the employer is seeking to inject fresh ideas and perspectives into an
employee culture that has become too inbred.
Healthcare organizations must regularly recruit externally to maintain clinical
skills and knowledge, most of which are taught in university programs. Among
external job sources are the Internet, print advertising, professional associations,
colleges and universities, employee referral programs, employment agencies, head
hunters, career and job fairs, and social networking sites.
Creative Approaches
As noted, staff shortages will continue in the foreseeable future, which will make
recruiting even more competitive. How can an organization fnd and pursue tal-
ented candidates when the competition is doing the same thing? The answer is
simple: The organization must position itself as the employer of choice and wage a
multifront effort that relies on all the available job sources in creative ways.
Chapter 6: Stafng for Customer Service 141
The typical job advertisement (in print or online) should be just one recruit-
ment method, not the only one. After all, the typical job hunter does not look at
ads only. Here are several creative approaches to recruitment (and by extension,
retention):
Robust benet package. Offering only one perk or beneft, such as a sign-on
bonus, is not enough of an incentive to keep the new hire on staff. Instead,
present an attractive benefts package. The package should appeal to a wide
range of workers and may include a competitive salary, medical and dental
insurance, a exible time-off and work schedule, and continuing education
opportunities.
University collaboration. Collaborate with universities and colleges to mine the
supply of graduate students or to invite undergraduate students to become
interns or fellows at the organization. The logic behind such a partnership
is that after graduation, a student who has become familiar with and even
made connections at the organization is more likely to stay on as a full-time
employee than a student who has no previous association with the employer.
Finders fee. Staff, patients, and other company associates are a good resource
for many things, including recruitment. Offer a fnders fee to a person
who can recommend a candidate who successfully stays on for a specifed
periodsix months, for example.
Focus group. Invite current employees to give feedback on every aspect of
employment at the organization, including the benefts package, culture,
management, and growth opportunities. These responses may be used to
design an attractive on-boarding program and a better recruitment and
retention strategy.
Re-hires. Seek out talented employees who left on good terms. Inviting them
to come back to the organization presents low risk, as they already know the
system and thus have no need for extensive orientation and training.
Following are major recruitment sources heavily used by healthcare organizations.
Professional Associations
Healthcare managers join professional associations to advance their professional
interests, but professional associations can serve another purpose: They can con-
nect their members with potential employees and/or sources of strong candidates.
These membership organizations (e.g., American College of Healthcare Executives,
American Organization of Nurse Executives, Healthcare Financial Management
142 Achieving Service Excellence
Association, Medical Group Management Association) provide networking oppor-
tunities that may yield information, partnerships, referrals, and recommendations
regarding a vast amount of issues, including fnding good employees.
Students
An employer may attract young workers into the organization by developing in-
ternship and residency programs that target those who are either still in school
or who have recently graduated. As mentioned, some organizations arrange for
students to work for them through a partnership with a college or university. The
arrangement may be in the form of feld work for class or a student work program.
For example, most health administration departments require graduate students to
get real-world work experience while taking academic coursework. Some clinical
programs count post-academic residencies or internships toward their licensing
requirements.
The obvious advantages to the student are that she fulflls credit/licensing re-
quirements and makes money in the process (that is, if the internship/residency
is paid). For the healthcare organization, the beneft is gaining access to a pool of
workers who are young, eager to learn, and academically trained but who do not
expect a permanent employment commitment.
Smart organizations keep a close eye on student employees to identify the ones
who have the potential to succeed in a particular position. They inform these im-
pressive workers of their interest, and they even offer scholarships or give them
special training in preparation for a full-time position after graduation. In turn,
students seek out institutions known to have carefully designed work-experience
programs that provide real-world learning opportunities and growth challenges.
Student recruitment programs can be a source of good employees who are will-
ing to learn and contribute to the organization. In addition, these programs can
function as a way for students to pay their dues in entry-level jobs until they learn
enough to merit a promotion.
Employees
Long-standing, high-performing, and reliable employees understand the organiza-
tion well and obviously like to work there. As such, they can recommend candi-
dates who can ft the culture and do the job well. Employees who bring in their
friends feel responsible for their friends actions and performance. Thus, they exert
positive peer pressure and encourage the new hires to do well, which works to the
organizations beneft. As mentioned earlier, many employers give an employee
referral reward if the new hire stays and does well through a probationary period.
The reward varies, from money to weekend trips to a resort area.
Chapter 6: Stafng for Customer Service 143
Organizational Reputation
An organizations reputation can also aid in recruitment. As Schneider and Bowen
(1995) note, employers who have a positive image in the community and a satis-
fed and motivated workforce have a deep applicant pool from which they can pick
the best. These employers of choice are good neighbors to the community and
have established their reputation for hiring and developing people for the long
term. Their mentality, according to Len Berry (1995, 7879), is to recruit and
hire well, offer a viable, expandable job, and expect most people to be productive,
long-term employees. Invest in these people rather than save on those who leave.
Lenaghan and Eisner (2006) argue, however, that further research is needed to de-
termine the degree to which being an employer of choice is associated with having
a greater number of qualifed applicants.
Successful service companies that top the J.D. Power customer satisfaction sur-
veys recruit for values and personality, rather than technical skills alone; empower
employees to act on their own; pay above market rate if necessary; attract career-
minded individuals who care about the long-term satisfaction of their customers;
promote from within; provide career ladders for everyone; and offer creative em-
ployee benefts such as telecommuting, fexible work schedule, and job sharing
(Denove and Power 2006).
In other words, if the company is known for offering high-quality services, it
will attract high-quality applicants who prefer to work for it rather than for the
competition.
The Competition
Watching employees at work at a different facility is a straightforward strategy that
healthcare managers can easily pull off, given that much of healthcare work is vis-
ible. A visit to a competing clinic may yield possible contenders for an open posi-
tion, as the manager is able to size up the clinic workers ability to not only perform
their tasks but also interact with peers and customers.
Most people like to be recognized for performing well. Approaching a potential
candidate about a job opening on the basis of his demonstrated capability will at-
ter and compliment the person. If he pursues the opportunity and is selected for
the position, the circumstance of his recruitment becomes a fond story that he and
his manager can share. If he declines to apply for the position, the manager may
ask him for a recommendation.
Callback
Candidates often enter the recruitment process but drop out before they can be
interviewed or screened; some organizations call them back several months later
144 Achieving Service Excellence
to see if they are still interested. This callback is worthwhile because, often, people
who opt out of the recruitment process do so because of another job offer. After
several months on the new job, however, these people may already know whether
or not they are a good ft for the job. For dissatisfed new hires, a callback serves as
a window of opportunity to switch jobs.
Evaluating the Recruitment Process
This assessment depends on the availability of reliable and comprehensive data on
applicants, a well-functioning human resources information system, the quality of
applicants, the applicants disposition, and recruitment costs.
Common measures of the success of a recruitment effort include the following:
Quantity and quality of applicants
Overall recruitment cost and cost per applicant
Diversity of applicants
Recruitment time or time to fll
Percentage of interviewed applicants who are hired
Percentage of those hired who are retained after one year
Increase in customer satisfaction
Decrease in customer complaints
SELECTI ON PROCESS
Customer-focused organizations cannot afford to have staff members who respond
to customers in any of the following ways: Its not my job, Its against policy,
Ill have to check with my supervisor, but shes out to lunch, or Youll just have
to wait until the doctor gets here.
Selection of new staff should be done by the whole team, rather than a single
individual, to allow for multiple inputs concerning customer service competen-
cies. During the interview process, after candidates have demonstrated their clini-
cal competence, the candidates should be evaluated on their hidden competencies
such as self-esteem, personal accountability, communication style, and customer
service. Applicants should be asked about how they have handled or will handle
particular situations, such as a diffcult patient or family member. The goal of this
interview should be to uncover service competencies, which are usually possessed
by 10 percent of the workforce.
Chapter 6: Stafng for Customer Service 145
Competency-Based Benchmarking
The intangibility of the healthcare experience and the uniqueness of each patients
expectations have frequently led organizations to use a secondary strategy for se-
lecting good candidates: Identify the best performers, and determine the personal
traits, tendencies, and talents that enable them to serve patients successfully. This
approach reveals the necessary KSAs of great employees in jobs rather than the
required KSAs of a particular job.
The logic of defning the persons, instead of the jobs, KSAs is that doing so
is easier, given that the customer service aspects of the healthcare experience defy
precise measurement or defnition. For example, putting together a meaningful
and useful list of job-driven KSAs for a hospital chaplain is diffcult. Thus, the al-
ternative is to study or measure the KSAs that equip people (in all types and levels
of jobs) for the roles they play in specifc organizational settings.
The outstanding performers in a job category can then serve as the templates for
the candidates hired for specifc jobs. In essence, this process is benchmarking
comparing against the organizations best to hire the best. Simply, if you hire only
those people who have KSAs that are similar to the KSAs possessed by strong job
performers, then the new hires should be as successful. Many organizations have
followed this strategy, which may be simplifed as follows:
1. They assess the traits, tendencies, and talents of strong performers.
2. On the basis of this assessment, they create benchmark profles for each major
job or job category.
3. They use these benchmark profles to screen new applicants.
The use of this benchmarking approach can be extended to ensure an appropri-
ate mix of talents in the entire department. If an analysis of a particular depart-
ment shows that the current composition of staff does not include a vital talent for
departmental success, the selection process should be refocused to ensure that the
next person hired into the unit possesses that missing capability.
Although a competency-based approach to selection offers advantages, it also
presents disadvantages:
1. It is expensive and often has to be performed by a third-party frm.
Consequently, this strategy is not cost effective if done for only one job or
job category. The effort and the expense can be worthwhile, however, for an
enterprise that desires to examine many jobs or job categories or is trying to
fnd the best ft for a senior leadership position.
146 Achieving Service Excellence
2. It is reliant on competency measures that constantly change with advancing
technology and evolving job expectations. Selection measures must adjust to
competency changes, thus creating the need for constant updating so that the
measures do not become irrelevant.
3. It uses job-category competency measures that may not be aligned with
measures and practices in other parts of the organization.
4. It could discourage diversity in KSAs. If only the KSAs of the best performers
are used as an ideal for future hires, then diverse opinions, talents, and
personalities are discouraged, making way for a homogenized structure
consisting of just that particular type of best.
General Abilities
In addition to assessing a prospective employees KSAs, competencies, licenses,
clinical training or experience, and customer service focus, healthcare managers
should watch for certain general abilities. Doing so does not downplay the vital
role of clinical competence, but it recognizes the equally vital role of personal
investmentthat is, caring about and effectively managing the customers total
healthcare experience.
General abilities include the following:
General mental abilities. Patients require staff who are able to intellectually
understand their concerns and fgure out how their problems might be
addressed and alleviated.
Enthusiasm. Patients expect to be served by employees who are enthusiastic
about the service, the organization, and the opportunity to provide service.
Because enthusiasm is contagious, it positively inuences patients moods and
satisfaction with the total healthcare experience.
Emotional commitment and conscientiousness. Healthcare jobs require a
heavy emotional commitment, a passion for service, and a readiness to be
conscientious at all times. Employees must stay upbeat, cheerful, enthusiastic,
and genuinely interested in serving the patient even when they do not feel
like it, when they are having a bad day, or when a patient is not reciprocating
the positive attitude. Not everyone, no matter how service oriented, can be
expected to be continuously emotionally committed, especially employees
whose jobs entail listening to complaints all day. For most employees, repeated
negative experiences eventually exact a toll and result in burnout. For other
employees, burnout is a consequence of having to do the same job in the
Chapter 6: Stafng for Customer Service 147
same way every day. At some point, many healthcare workers, including the
receptionist, switch into an automatic-pilot mode, weary of the work and
unable to make sincere emotional connections.
Staff who possess all three general abilities enhance the capability of the organi-
zation to satisfy and exceed the needs, wants, and expectations of patients. General
abilities may be more or less important at various stages of an employees career. For
example, a study by Tracey, Sturman, and Tews (2007) found that general mental
ability was a better predictor of performance for new employees, whereas conscien-
tiousness was a better predictor of performance for experienced employees. These
fndings have direct implications for staffng decisions, employee training and de-
velopment, and performance management.
Job Crafting
Although job analysis provides the basis for developing job descriptions and specifca-
tions, it does not outline job boundaries. Job crafting is the physical and cognitive change
employees make in the task or relational boundaries of their work (Wrzesniewski and
Dutton 2001). In other words, employees have the latitude to defne or craft their job.
They can use their knowledge of the organizations strategic goals to motivate their
work and legitimize their membership in the group. Because job crafting is common
among employees, the employer must hire people with a strong service orientation.
For example, the maintenance crew of one hospital crafted their cleaning du-
ties under the care of customers rubric (Wrzesniewski and Dutton 2001; Wrzes-
niewski, Dutton, and Debebe 2003). They viewed their job as part of an integrated
whole, rather than as a series of discrete tasks related to cleaning. Under this new
framework, the maintenance crew functioned with an additional caring compo-
nent, allowing them to relate differently with staff, patients, and families. Members
of this group liked their jobs and felt the work required higher skill levels. They
took on more tasks and timed their work to be maximally effcient to the workfow
of their respective units. Also, they initiated or participated in warm, friendly in-
teractions. As a result, the group helped the staff s jobs go more smoothly and the
patients day brighter (Wrzesniewski, Dutton, and Debebe 2003).
Nurses have also engaged in job crafting. By paying attention to the patients
world and conveying seemingly unimportant information to others on the care
team, these nurses re-created their jobs to be about patient advocacy rather than
simply about the delivery of high-quality technical care. They also expanded the
148 Achieving Service Excellence
job boundaries by including the patients family in care giving (Wrzesniewski and
Dutton 2001). The results were better clinical and service outcomes.
Job crafting will occur with or without encouragement from management.
However, it will be undertaken more frequently if management rewards the prac-
tice and hires people who are willing to try it. Job crafting is benefcial for customer
service because it empowers employees to mold their jobs in ways that meet and/
or exceed customers needs, wants, and expectations.
PersonOrganization Fit
Personorganization ft is the extent to which an applicants values match the
values and culture of the employing organization.Value congruence is perhaps the
overriding principle of ft (Kristof-Brown, Zimmerman, and Johnson 2005, 285).
Furthermore, research suggests that serious applicants are likely to be as concerned
as the employer about ft (Rynes and Cable 2003). However, selection methods for
ft are far from perfect and are largely untested. Arthur and colleagues (2006) sug-
gest that if ft is used as a selection criterion, then ft measures must be held to the
same psychometric and legal standards as are more traditional selection tests.
While the idea of ft is appealing, researchers and managers do wonder if it con-
tributes to job performance. Hoffman and Woehr (2006) found that ft is weakly to
moderately related to job performance, organizational citizenship behavior, and turn-
over. In their meta-analysis of the studies in this area, Kristof-Brown, Zimmerman,
and Johnson (2005) discovered that ft is strongly associated with job satisfaction and
organizational commitment and is moderately correlated with intention to quit, sat-
isfaction, and trust. However, the same study found a low correlation between ft and
overall job performance.
This evidence should not discourage efforts to achieve ft, but institutions need
to have realistic expectations regarding the link between great performance and
ft. Certainly, hiring without concern for ft has led to poor long-term outcomes
(Rosse and Levin 2003).
Targeted selection and behavior interviews are some of the human resources processes
that have made hiring on the basis of personorganization ft possible. For example,
Women & Infants Hospital of Rhode Island made an explicit effort not only to select
employees on the basis of their ft with the culture, believing that a person must be quali-
fed to do the job, but also to require the right personality to ft into its customer-focused
culture (Greengard 2003). After starting a hiring program using behavior-based inter-
views and in-depth analysis of candidates, the hospital saw patient satisfaction rise from
the 71st percentile to the 89th percentile, while turnover was reduced by 8.5 percent.
Chapter 6: Stafng for Customer Service 149
Labor disputes also decreased, while productivity increased (Greengard 2003). Similarly,
UNC Hospitals use the Targeted Selection approach to assess employees core values and
attitudes in relation to those of the organization (DDI 2008).
SCREENI NG METHODS
Application Form
The application form, most of which can be completed online, is the frst screen
a candidate will go through. It serves as the hiring managers preliminary check
on whether or not the candidate possesses bona fde qualifcationsan important
detail to check to avoid charges of discriminatory hiring practices.
In developing an application form, managers should include enough work his-
tory and experience questions to enable a reasonable decision about which applicant
should be called for an interview and which should be overlooked. Obviously, a
major trade-off is involved here. The recruitment strategy should be designed to
bring in as many legitimate candidates as possible. To attract a large number of quali-
fed applicants, the job advertisement must be clear about minimum qualifcations,
work experience, service orientation, and education/training required.
Sometimes the application form is incorporated into a job hotline, an automated
telephone line that lists job openings. With this method, the candidate responds
to basic personal and work history questions. If the information given matches the
employers predetermined criteria, the candidate is asked to fax, e-mail, or mail a
resume. Sophisticated optical character recognition or OCR systems can scan the
resume, evaluate the candidates suitability for the job, summarize the qualifca-
tions, and forward it to the manager.
Automated and online systems allow people to apply for a job 24 hours a day, 7
days a week and guarantee that each application is reviewed by the hiring organiza-
tion. As such, they are equally useful for both applicant and employer.
Interview
If the applicant passes the initial screening, she will be contacted for an interview. The
interview gives both parties a chance for face-to-face interaction, a powerful component
of the selection process. More important, the interview is an opportunity to tell the
candidate about the need to commit to the patient-focused philosophy of the organiza-
tion and to ask questions about behaviors that are consistent with that philosophy.
150 Achieving Service Excellence
During the interview, both parties can pose direct questions to each other and
observe traits and body language that are impossible to discern over the phone
or through the application form and resume. Discussions at this time focus on
work experience and qualifcations, job duties and expectations, the positions ft
within the larger departmental and organizational contexts, and possibly benefts
and compensation.
Obviously, the human resources department should verify the candidates skill
set and share the organizations standards of behavior (Studer 2008). For example,
at Baptist Health Care, the questions at the frst interview are focused on behav-
iors, and candidates are informed of the behavioral standards upheld at the organi-
zation. These standards were developed by employees and relate to such aspects as
integrity, dependability, exibility, and customer service.
Typically, if the frst interview goes well, a second interview is scheduled. The
unit or departmental leader (if not the same as the manager) makes the decision to
let the applicant continue to the next round of interviews. At the second interview,
the applicant should meet with at least two potential coworkers. Many times, the
objective of the second interview is to determine if the candidates personality,
customer service orientation, and work style will blend with or complement those
of the current staff members. Sometimes, however, the second interview is used to
gain clarifcation on the items discussed during the frst interview.
Determining an applicants talent (inborn or natural capacity) has also been
a focus of the second interview. The purpose of the talent discussion should be
made clear (e.g., to address the applicants customer orientation), and open-ended
questions or scenarios should be posed (e.g., What will you do if? Give an
example of.). Hypothetical job situations should be broad enough to draw a
range of responses. In addition, the candidate may be asked about specifc respon-
sibilities that he fnds fulflling.
Peer Interview
Peer interviews help reduce turnover. Because staff are intimately involved in the
hiring process, they take a personal interest in and ownership of a new employees
success.
Before the peer interview, the structure of the interview (e.g., who asks a ques-
tion frst, is it formal or relaxed) should be decided and behavior-based questions
related to the jobs KSAs should be developed and selected. Questions may fall
under such categories as integrity, communication, decision-making ability, de-
pendability, and creativity. Peer interviewers should be prepared to answer ques-
tions from the candidates and to give feedback about the interview later on.
Chapter 6: Stafng for Customer Service 151
Structured Questions
A structured interview increases the likelihood that all candidates will be assessed
according to the same criteria, regardless of who conducts the interview. Consis-
tency is organizationally and legally important. Structured questions ensure that
each interviewer collects the same personal and professional information from
every applicant.
Probing questionssuch as Tell me about yourself, Why are you interested
in this job? What are your qualifcations?may yield informative responses.
But these questions are not universally interpreted; that is, one candidate may talk
about his hobbies, while another may give a detailed history of his childhood hopes
and dreamsneither explanation has anything to do with the job itself. Structured
questions, on the other hand, are clear, job related, consistently scored, and posed
to all candidates.
Three types of structured questions exist:
1. Critical incidents skills. These questions revolve around how the applicant
works through a positive or negative event that occurs during a service
encounter. For example, What would you do if the patient constantly
complains about your performance? The response can be scored on the basis
of the job description, which should be customer oriented.
2. Clinical/task competency. These questions address how the candidate performs
technical tasks. For example, What admission software are you familiar with?
What admission procedures have you followed? Scoring here can be objective
(either correct or incorrect), depending on how specifc the questions are.
3. Willingness to work healthcare hours. These questions test the applicants
readiness for the irregularities inherent in healthcare work, such as overtime,
long shifts, holidays, nights, and weekends. If the candidate is reluctant or
uneasy about these hours, then he is not a good ft.
Psychological Tests
A variety of tests is available, including those that measure logical reasoning, in-
telligence, conceptual foresight, semantic relationships, spatial organization, and
memory span. Tests of mechanical ability, physical ability, and personality may also
be used.
Organizations have used these tests with mixed results. Physical and mechani-
cal ability tests are more valid predictors of later job success than are mental or
152 Achieving Service Excellence
cognitive tests. Personality and other mental measures are much harder to validate
against successful job performance. What makes a successful manager? or What
personality type makes a more effective leader in a particular situation? are dif-
fcult questions to answer. Research has found that personality has fve dimensions
(Zhao and Seibert 2006):
1. Extroversion: the degree to which someone is talkative, sociable, active,
aggressive, and excitable.
2. Agreeableness: the degree to which someone is trusting, amiable, generous,
tolerant, honest, cooperative, and exible.
3. Conscientiousness: the degree to which someone is dependable and organized,
conforms to the needs of the job, and perseveres with tasks.
4. Emotional stability: the degree to which someone is secure, calm, independent,
and autonomous.
5. Openness to experience: the degree to which someone is intellectual,
philosophical, insightful, creative, artistic, and curious.
Of these fve dimensions, conscientiousness is considered to be the most valid
predictor of job performance. In studies that investigate the relationship between
possessing these fve traits and being a successful worker in the service industry,
three dimensions are found to be critical: agreeableness, emotional stability, and
conscientiousness (Dilchert, Viswesveran, and Judge 2007).
Results of personality tests may help managers gain an understanding of an
applicants service orientation. Certain personality characteristics, such as friendli-
ness, are useful in a service-intensive feld. However, more research is needed to
support the contention that personality dimensions are strongly associated with a
persons ability/inability to provide customer service.
Background and Reference Checks
No organization that sends out its employees to provide an unsupervised service
can afford to send someone who has not been thoroughly checked out. Thus,
most healthcare organizations routinely perform background checks to protect
themselves and their patients. The healthcare industry is especially different from
a manufacturing sector in this regard. A car does not care if a former car thief is
part of the assembly team, but a hospital patient will not tolerate the fact that the
housekeeper has gone to jail for assault and battery. Revelation of a staff members
criminal record not only can cause embarrassment but also can damage the orga-
Chapter 6: Stafng for Customer Service 153
nizations reputation. Worse, it can invite lawsuits from patients, who may fnd the
organization liable for not exercising due diligence.
Reference checks may be more reliable and valid if a recent employer is con-
tacted, the reference provider is the same gender and ethnicity as the applicant,
and the old and new jobs are similar in content (Fried and Gates 2008). Some
employers check professional networking sites, such as LinkedIn and Jobster, to
get in touch with people who know the candidate personally and professionally
(Athavaley 2007). Recruiters and hiring managers use social networking sites (e.g.,
Facebook, Myspace, Twitter) to fnd connections with whom they can talk about
the candidate. Social networking sites have also added features that assist recruiters
in fnding more information about prospective employees (Athavaley 2007).
RETENTI ON
A weak retention system can compromise even the strongest recruitment and se-
lection processes. Simply, hiring talented people is not enough; mechanisms have
to be in place as well to ensure that new employees stay for a while. Experienced
employees know how to get the job done, how to recognize and solve problems,
and where to go for help if needed.
One factor shown to encourage retention and commitment is workers be-
lief that the organization treats them fairly, considers their interests, and shares
fnancial success with them (National Institute of Business Management 2001).
A healthcare organization that is driven to keep its best performers can easily turn
this perception into a reality.
Relationship Among Staff Satisfaction,
Customer Satisfaction, and Financial Performance
A strong relationship exists between employee retention and the organizations
fscal performance (Studer 2004). Specifcally, the higher the retention rate, the
greater the revenue (Glebbeck and Box 2004). Furthermore, worker happiness and
satisfaction are found to be strongly correlated to patient satisfaction (Marketing
Health Services 2004). The logic behind this is twofold.
First, turnover creates a staff shortage and/or the use of less experienced
employees, which manifests itself in various types of inefficiencies, including
longer wait times (Kacmar et al. 2006), underutilization of equipment (Shaw,
Gupta, and Delery 2005), and higher costs (Marrow and McElroy 2007).
154 Achieving Service Excellence
Second, inefficiencies lead to low staff morale, which ultimately leads to poor
clinical outcomes and dissatisfied patients. This cycle can continue perpetu-
ally if turnover is not managed.
Again, satisfed employees stay, and they are well equipped to handle workplace
relationships, stresses, and changes. There are no easy solutions to the staggering
healthcare costs and reductions in reimbursements faced by healthcare managers
and leaders. Inevitably, cuts in expenses have been and will be made, and these cuts
have an impact on both staff workload and turnover. What is important for man-
agers to consider is the long-term, multilayered effect of worker dissatisfaction.
Operating in the red is diffcult, but functioning without a clinically competent
and service-oriented staff is impossible.
Role of Managers
According to Buckingham and Coffman (1999), managers trump companies
when it comes to retaining employees. More recent data confrm this statement
(Gallup Management Journal 2006). Simply, working for a great manager in a regu-
lar organization is better than working for a terrible manager in an organization
that appears on a best list.
A great manager is defned as someone who informs employees of what is ex-
pected of them; provides the necessary tools, material, and equipment; allows em-
ployees to do what they do best; recognizes, praises, or celebrates good, not just
exceptional, work; cares about each employees personal life; and encourages the
professional growth and development of every employee.
Studer (2008) argues that an employees unfulflling relationship with her su-
pervisor can be the most important reason for her departure from the job. He
identifes other factors as well, such as frustrating work processes, lack of tools nec-
essary for the job, absence of career development and training, poor management
of bad performers, and lack of appreciation. Studer recommends regular meetings
between a supervisor and an employee, especially a new hire. A manager may ask
the following questions during this meeting (Studer 2008, 179):
How do we compare to what we said we would be like?
Tell me what you like. What is going well?
I notice you came from ______. Are there things you did there that might be
helpful to us?
Is there anything here that you are uncomfortable with?
Chapter 6: Stafng for Customer Service 155
Do you know anyone who might be a valuable addition to our team?
As a supervisor, how can I be helpful?
One study examined the strategies used by nurse managers who have succeeded
in achieving low turnover rates and high satisfaction among patients, employees,
and providers; good patient outcomes; and positive working relationships (Manion
2004). The study found that these nurse managers were able to develop a culture
of retention. Through their daily work, these managers created an environment
where people want to stay because they enjoy the work and can contribute to sus-
taining this positive environment. These managers emphasized sincere caring for
the welfare of their staff, forging authentic connections with each staff member and
focusing on results and problem solving. Note that these strategies are not likely to
succeed without a culture of retention.
Retention Strategies
Several general retention strategies have been shown to work:
1. Offer competitive compensation.
2. Structure jobs so that they are more appealing and satisfying. This can be
done by carefully assigning and grouping tasks, providing employees with
suffcient autonomy, allowing fexible work hours and scheduling, enhancing
the collegiality of the work environment, and instituting work policies that
are respectful of individual needs. In the nursing environment, job design
encompasses elements such as the nursepatient staffng ratios and mandatory
overtime.
3. Put a superb management and supervisory team in place. Remember that
people quit their supervisors, not their jobs.
4. Make opportunities for career growth available. Providing career ladders is
increasingly diffcult, as organizations become fatter and widen their spans of
control. Alternatives to promotions need to be developed and implemented.
Becoming a Magnet healthcare organization seems to be another retention
strategy. The American Nurses Credentialing Center established the Magnet Rec-
ognition Program to acknowledge and reward institutions that exhibit and provide
excellent nursing care. Designated Magnet hospitals are characterized by fewer
hierarchical structures, decentralized decision making, exibility in scheduling,
156 Achieving Service Excellence
positive nursephysician relationships, and nursing leadership that supports and
invests in nurses career development (Cameron et al. 2004). Magnet hospitals
have been found to have better patient outcomes and higher levels of patient satis-
faction (Scott, Sochalski, and Aiken 1999). Compared to other hospitals, Magnet
institutions have lower turnover and higher job satisfaction among nurses (Huerta
2003; Upenieks 2002).
The Healthcare Advisory Board (HCAB 2002) conducted an extensive review
of recruitment and retention strategies to determine each strategys relative effec-
tiveness. Findings are as follows:
Strategies that do not increase morale but improve retention: Improving screening
of applicants, monitoring turnover in key areas, and tracking turnover of key
employees.
Strategies that increase morale and improve retention: Establishing staffng ratios,
providing career ladders, implementing buddy programs, and allowing exible
scheduling.
OTHER STAFFI NG CONSI DERATI ONS
Diversity
A diverse staff composition is the moral and legal way to operate a modern, cus-
tomer-focused enterprise, especially a healthcare organization. In the United States,
much progress has occurred in race relations and many barriers to cultural, gender,
and economic (to name a few) equality have been broken down. These advances,
along with the rise of the global economy, have changed the demographic makeup
of not only patients but also clinicians and other healthcare workers in many U.S.
cities.
A diverse customer population expects a diversity-friendly service organiza-
tion to provide culturally competent and sensitive care. Customers want talented
healthcare providers and employees who represent their race or background and
who speak their language, fguratively and literally.
An obvious staffng strategy for an organization located in a demographically
diverse area is to recruit and retain employees who have the ability to communi-
cate, interact, or empathize with patients from different cultures or ethnicities. For
example, many healthcare facilities in Orlando, Florida, deliberately hire staff who
are bilingual (i.e., English and Spanish) to facilitate communications with the large
Latino population in the area.
Chapter 6: Stafng for Customer Service 157
The diverse workforce itself needs attention and consideration from healthcare
managers. A typical healthcare employee no longer exists. Todays workplace is
flled with dual-career couples, same-sex partners, single parents or grandparents,
grown children with elder-care responsibilities, senior workers, female and minor-
ity senior leaders, and other modern-day realities. The manager must be sensitive
to the needs and expectations of these employees and avoid designing one-size-fts-
all selection, training, and reward systems.
Unfortunately, many organizations still do not fully appreciate, and hence
underutilize, the diversity of skills and talents among their workers and within
their diverse communities. A diverse workforce gives an organization a com-
petitive edge, a reality that many institutions capitalize on by seeking out and
recruiting people who not only are skilled but also have a customer service ori-
entation. Such employees will deliver culturally and linguistically competent
services and thrive on the challenge of taking care of a multicultural patient
population.
CONCLUSI ON
Recruiting and selecting the right person is challenging for all organizations, but it
is especially diffcult in the healthcare industry. Job seekers in all felds must have
skills that can be defned, measured, and tested. In the healthcare arena, how-
ever, job applicants must also possess interpersonal skills and creativity in handling
patient problems. Often, the difference between a good and a great healthcare
experience for a patient is the indefnable extra that an employee brings to the
experience.
Retaining a high performer is the next challenge. The best healthcare orga-
nizations view staff recruitment and retention as the responsibility of each staff
member and as an organizational priority. As such, these processes are included
in the agenda at every board meeting and in the performance evaluation of
each manager and supervisor.
Service Strategies
1. Empower employees to serve by giving them training, rewards, and
encouragement.
158 Achieving Service Excellence
2. Do not hire anyone who cannot or will not provide outstanding service.
Customer service is everyones responsibility, not just direct service
providers.
3. Perform a thorough job analysis before undertaking the recruitment
process.
4. Assess the attitudes and values of job candidates, not just their job skills.
5. Involve the entire team in the selection process, especially during the
interviews.
6. Benchmark a high performers knowledge, skills, and abilities, and then
use this benchmark to screen an applicant and to create a model for a
particular job.
7. Encourage and reward the practice of job crafting.
8. Weigh the pros and cons of promoting from within and recruiting
externally.
9. Use all available recruitment strategies and sources, including creative
approaches such as asking/recruiting past employees and studying
competitors employees.
10. Conduct a structured interview that relies on questions that are job related
and can be scored.
11. Carefully consider the long-term, multilayered effect of worker
dissatisfaction when making budgetary cuts that affect workload and
retention.
12. Focus on retention of top performers by identifying and providing what
they value most.
159
The dominant competitive weapon of the 21st century [is]
the education and skills of the workforce.
Lester Thurow, former dean of Sloan School of Management,
Massachusetts Institute of Technology
C H A P T E R 7
Customer Service Training
Service Principle:
Train employees, and then train them some more
The core of all customer service training is simple: Enable employees to
view the experience through the customers perspective and then act accord-
ingly. With this perspective, employees are better equipped to create an out-
standing service experience.
Service expert Len Berry (1995) identifes fve key factors that customers use
to judge the overall quality of service. Of these fve, four are directly related to
the ability of the service employee to deliver the service in the way the customer
expects, and the ffththe tangiblesincludes the appearance of the service em-
ployee. These fve factors are as follows:
1. Reliability: the organizations and employees ability to deliver the service
consistently, reliably, and accurately
2. Responsiveness: the employees willingness to provide prompt service and help
customers
3. Assurance: the employees knowledge, courtesy, and ability to convey trust
4. Empathy: the employees willingness to provide caring and individualized
attention to each customer
5. Tangibles: service factors in the environment that are easily observed by customers
The nonhuman, inanimate aspects of healthcare, such as the physical product,
setting, and equipment, are clearly important in forming the patients impression
of the total experience. But the individual service providersfrom the nurses aide
160 Achieving Service Excellence
to the specialized surgeonare the ones who can either make or break the orga-
nizations relationship with the patient in each and every encounter or moment of
truth. The patient-centric culture of the organization provides some strong cues on
how to deal with patients, but customerstaff encounters cannot be left to cultural
cues or the good intentions of employees.
For the medical staff to design an effcient clinical care system and the human
resources department to select the right people are not enough. Healthcare organi-
zations that consistently deliver high-quality healthcare experiences also extensively
and continuously train their employees. Excellent healthcare organizations recognize
the value of spending the necessary time and money on preventing service failures
(and occasional disasters), and they know that an excellent way to do so is to invest
in management and staff training and development. Emphasizing the signifcance of
training by investing time and money into the process illustrates the organizations
commitment not only to patient-focused care but also to its staff s development.
In this chapter, we address the following:
Leader and staff development
Customer service training
Training methods
Although we provide principles and approaches related to general training, we
focus the discussion on customer service training.
LEADER DEVELOPMENT
Most CEOs say that leadership development is a priority in their organizations.
However, often, the hours of training that managers and leaders receive are inad-
equate considering the breadth of their responsibilities. Such development is vital
to the organizations well-being, but it is typically forgone because of an alleged
lack of time, money, and proof of its benefts. Instead, the development offered
has vague objectives and applications and rarely yields sustainable results (Studer
2008). Studer (2008, 125) argues that leadership development must be treated as
though it is the premium tool that keeps the companys engine stoked and purring
smoothly for the long-haul.
No organization can achieve excellence without great leaders. Great leaders do
not appear out of thin air, as even natural-born leaders need coaching. Thus, orga-
nizations have to invest in leadership development that hones the skill sets neces-
sary for accomplishing mission goals. Such training must be continuous, rather
than episodic, so that lessons learned are reinforced.
Chapter 7: Customer Service Training 161
Studers Five Principles
According to Studer (2008, 12932), leader development and training should be
based on fve principles:
1. The CEO and other top executives must drive the training. Senior leaders must
be present from day one to kick off the training, observe it, participate in it,
and wrap it up.
2. All leaders must be trained. Training only select members of the leadership
group will not usher in signifcant changes.
3. Leaders must be involved in designing the training. Their input should reveal
the ineffciencies, defciencies, and diffculties encountered by management
and staff on a regular basis. Organizational mission, goals, and challenges
can be the starting point for identifying specifc areas of development and
training. For example, leaders may name the three top problems in customer
service and then gear the training toward solving those identifed issues.
4. Training outcomes must be linked to organization-wide goals. The new ideas
and methods a leader takes away from the training must be relevant and
applicable to her particular work and should improve her own performance,
thereby enabling her to meet desired departmental and organizational
objectives.
5. Leaders must gain an acute understanding of the ve phases of organizational
change. Phase one is the honeymoon period, where people are enthusiastic
about learning. Phase two is the reality phase, where some employee
expectations are not met and employees may view managers as them.
Phase three is the discovery stage, where performance gaps become apparent
among employees, which may result in staff claiming unfair treatment and
managers attempting to improve the performance of mediocre workers. Phase
four is the intervention phase, where managers identify and address problems.
Phase fve is the action stage, where solutions and plans are developed and
implemented.
Leadership development and training may focus on teaching leaders how to
manage each phase. Phase one topics may include establishing behavior standards,
communicating widely and regularly, and hardwiring key behavior expectations.
Phase two topics may address recruiting former high-performing employees and
preparing to have conversations with high/middle/low performers. Phase three top-
ics may focus on responding to tough questions, completing conversations with all
levels of staff, and ensuring the right people are in the right places. Phase four top-
ics could revolve around innovation and standardization of key behaviors. Phase
162 Achieving Service Excellence
fve topics could teach communication skills, including the art of high, middle, and
low levels of interaction and the appropriate time and people to conduct them.
Example: Benefit of Leadership Training
Sacred Heart Hospital in Eau Claire, Wisconsin, is known for its commitment
to patient satisfaction (Buckley 2007). One of the components of Sacred Hearts
strategic plan was to start customer service excellence at the top: Provide leadership
development.
With this focus, the hospital took its leaders offsite for training on the hospitals six
pillars of success: quality, service, people, cost, growth, and congruency. Sacred Heart
understood that beginning an organization-wide initiative with the leaders made sense
because they serve as the role models of behavior for the rest of the institution. Next,
the hospital created an accountability system to ensure that the newly trained leaders
applied their learning. Service standards were established, using input from staff at all
levels and benchmark information from other hospitals and the Ritz-Carlton.
After these initial efforts, Sacred Heart turned its attention to training its em-
ployees, which is discussed in the next section.
STAFF TRAI NI NG
The average company spends approximately 2 to 2.5 percent of its payroll bud-
get on training-related efforts, while the best organizations invest up to 3 percent
(Killian 2009). Outstanding service providers make such a major investment in
training and development because they receive a large return.
Customer service training programs for staff should include the following com-
ponents (Business Research Lab 2007):
Statement from the organization about the value of customer satisfaction
Description of drivers of customer satisfaction
Explanation of programs for measuring customer satisfaction and recognizing
staff s contributions to its achievement
Expectations of employees role in keeping customers satisfed
Measurable increases in patient satisfaction and in competitive advantage are
among the many benefts of providing training. Exhibit 7.1 discusses the lack of or
inadequate employee training and development as a stressor.
Chapter 7: Customer Service Training 163
Training Frontline Staff
Healthcare organizations have a dual challenge in training employees who have direct
patient contact: They must teach staff not only how to perform their jobs effciently but
also how to interact positively with both external and internal customers. If the selec-
tion process went well, the employee hired can, presumably, do his job, so the training
he receives should be focused on honing his clinical skills and performing his duties at
a consistently high level and under the supervision of patients, family members, unit
managers, and peers. On top of this, the employee must be trained on how to approach
patient complaints in a creative and satisfactory manner.
A major undertaking, the training for patient-contact staff members goes
far beyond teaching clinical protocols for drawing blood or administering
medications.
Exhibit 7.1 Lack of Training and Development as Employee Stressors
Employees need adequate training. Training is a delicate subject for many employees because they
are reticent to admit that they dont have adequate KSAs to complete their jobs. Training programs,
even when they are based on some sort of clinical or practicum experience, are unable to address all
the contextual nuances of a job. Thus, while many healthcare professionals may be technically sound,
they still struggle on the job because of aspects of the work or tasks specifc to the workplace. Lack
of training in these areas sets them up for failure and is a signifcant stressor. Think about your own
position. Did you know everything about the job when you started? How long was your learning curve
before you felt up to speed? I have yet to talk with someone who was able to hit the ground running on
the frst day of his job; there are always things people could not know before starting.
Healthcare professionals crave true development, the kind that pushes them to think and broaden
their horizons. In the same way that discussion with employees can pinpoint training opportunities,
discussion with healthcare professionals can elicit development opportunities. Even more gratifying for
employees is to have them create new development programs for others. Employees feel empowered
when they are asked to develop the skills of other employees. This form of development is particularly
enriching in that the ultimate learner in the process is the one doing the teaching.
Annual performance appraisals are a signifcant source of stress for all involved. Rather than
scheduling that awkward annual meeting, document and give regular feedback that reinforces
positive behaviors. Problematic behavior should be documented as well, but keep in mind
that, according to learning theory and research, people react better to positive reinforcement.
Punishment tends to prompt avoidant behaviors, not change for the better. When emphasis is
placed on what employees do wrong, they dont know what they need to do to improve. Positive
feedback guides people in the right direction.
Source: Adapted with permission from Halbesleben, J. R. B. 2009. Managing Stress and Preventing Burnout in
the Healthcare Workplace, 8891. Chicago: Health Administration Press.
164 Achieving Service Excellence
Four Dos of Staff Training
Do empower staff. No amount of training will matter if employees are
not given the authority or encouragement to apply their learning in the
workplace.
Do provide well-designed training. Consistently poor training results in a
domino effect: the employees and the organizations performance drops,
which causes high turnover, which leads to low company morale and job
dissatisfaction, which negatively affects the customer (ACHe-news 2001).
Do make the training interactive. No one wants to listen to a three-hour
lecture; such a format discourages learning. Interactive training, on the other
hand, allows participants to exchange ideas with the facilitator and the group.
Active involvement in any kind of process is more memorable than passive
attendance.
Do make training a regular occurrence. Training an employee once (e.g., at
the employee orientation) is not enough in a customer-driven healthcare
environment. Managers should continually reinforce the organizations
customer service orientation and the employees role in this culture.
In addition, some healthcare facilities now provide training for patients. The
purpose of such training is to give patients the information they need to enhance
their overall experience with the facility and their level of patient satisfaction (see
sidebar).
Impact on Retention and Turnover
Training is less costly than recruiting. When good employees leave, they take away
knowledge, skills, and abilities, much of which they likely obtained during their
tenure on the job. For the organization, this departure means two things: (1) re-
cruiting and hiring a replacement and (2) investing money and time to train the
new hire. A training strategy should be useful and well designed so that it helps
minimize turnover and maximize retention.
More important, a robust training program conveys to employees that they
are valued and not easily dispensable or replaceable. Such a perception then
encourages staff to stay, to widen their expertise, and to perform their duties
better. As a result, patients, their families, and other employees are served
satisfactorily.
Managers of clinically excellent healthcare organizations may wonder if mount-
ing a sustainable customer service training program is worth the time, effort, and
Chapter 7: Customer Service Training 165
money. Exhibit 7.2 is an example of how Baptist Health Care confronted this con-
cern when it underwent a customer service culture transformation.
Following are examples of how various organizations frame their training:
Operating under the principle that happy workers lead to happy patients,
Sacred Heart Hospitals employee training is based on customer perceptions
that is, patients response to the question, What do you need from staff to
receive good care? The answers are then incorporated into staff training
(Buckley 2007).
To improve their service and differentiate themselves from competitors, many
healthcare organizations are seeking advice and assistance from customer-
oriented hotels, such as the Four Seasons, Marriott, and Ritz-Carlton
(Saranow 2006). Training topics range from maintaining service consistency
across various locations to hiring staff with instincts for good service. Ritz-
Carlton sensed this business opportunity several years ago and started to
offer training classes at its center in Chevy Chase, Maryland, and at its hotels
throughout the country.
Ritz-Carltons most popular class is Legendary Service, a full-day program
that teaches attendees about the Ritz-Carlton culture (with a motto of We
are ladies and gentlemen serving ladies and gentlemen), the use of personality
assessments in recruitment, and the role cash incentives play in motivating
employees to go above the call of duty. Class participants also hear stories of
employee empowerment, including the practice at the Ritz to allow staff to
SIDEBAR: PATIENT TRAINING
We put patients rst was the theme of New
York-Presbyterian Hospitals (NYP) 2007 stra-
tegic plan. To implement its patient-centered
agenda, NYP partnered with a technology com-
pany to develop multimedia programs intended
to enforce the message that patients are active
participants in their own treatment (Liebowitz
2008). These programs are an innovative way
to engage, educate, and empower patients, en-
abling patients to better understand the clinical
procedures they are scheduled to undergo or to
better manage their medical conditions.
NYP invested in these multimedia programs
after learning of research that shows patients
retain only 20 percent of the information they
receive during physician consultations. Because
the programs may be viewed multiple times,
patients are likely to retain the information and
share them with family members and caregiv-
ers. In addition, because the programs are Web-
based, they can be accessed from any computer
with Internet access. More important, patients
can use the programs at their own pace and
convenience.
This patient training tool is indeed benecial
to patients, easing their minds about an upcom-
ing procedure and encouraging them to have
more condence in the care process and the
care providers.
166 Achieving Service Excellence
spend as much as $2,000 per day on problem resolution without supervisor
approval (Saranow 2006).
As described in Chapter 2, Walt Disneys guestology approach is an integral
part of its customer strategy. Since the mid-1980s, Disney has been offering
professional training through the Disney Institute (see www.disneyinstitute
.com). Disneys customer service approach is summarized in its S.T.O.R.Y.
method (Whittmore 2007):
Study the audience
Tailor the experience
Orchestrate the details
Relate
Yield long-term relationships
Exhibit 7.2 Customer Service Training for Staff: Barriers and Benets
Barriers Benets
1. We dont need to. Sets sustainable results
Lives values
2. We dont have enough time. Its the right thing to do
Helps improve employee and patient satisfaction
3. We cannot be gone from the Shares responsibility and creates ownership

department.
Allows coordination and consistency within the
leadership team
4. What more do I need to learn? Speeds the development of the skill set
Tailor-made for the organization
5. Its too costly. Not as costly as having poor leaders create lawsuits
Creates a team that can adjust to environmental
changes
6. We already do it. Raises the bar
Networking builds relationships, trust, and support
Creates a built-to-last culture
Source: Reprinted with permission from Baptist Leadership Institute, Pensacola, Florida. Originally
included in a presentation, Turning Customer Satisfaction into Bottom-Line Results, by Q. Studer and
G. Boylan, July 2000.
Chapter 7: Customer Service Training 167
ELEMENTS OF A GOOD TRAI NI NG PROGRAM
First and foremost, employee training should cover the basics: the organizations
service mission, culture, values, practices, strategies, products, and policies. Typi-
cally, this basic training is given at the employee orientation, but it should be
provided repeatedly through various ways. Until all staff are clear on organization-
specifc information, they cannot fully understand the knowledge and behaviors
expected of them. Furthermore, because the patient defnes the quality and value
of the healthcare experience, employees should learn about patient expectations,
competitor services and strategies, industry trends and developments, and the gen-
eral business environment (Berry 1995). Even an x-ray technician needs to know
something more than how to operate the x-ray machine to meet the service expec-
tations of the patient on the x-ray table.
Healthcare consultant Patrice Spath has helped many corporations improve
their training. Spath offers fve guidelines to developing a successful training pro-
gram (Lau 2000):
1. Set clear objectives. If clear and specifc objectives are not set, people will not
know what to work toward. An example of a clear objective is to cut the
errors that occur during the delivery of drugs to patients. According to Stencel
(2006), the cost to hospitals of treating drug-related injuries is staggering, at
approximately $3.5 billion a year (2006 fgures). This estimate does not take
into account the lost wages and productivity of those who suffered the adverse
event.
2. Show that training adds value to staff s lives. Employees are more accepting
(and thus less reluctant) of training if they recognize its contributions to their
career and personal pursuits. Ultimately, these growth opportunities result in
improved retention rates.
3. Conduct role-playing sessions. Role playing not only makes the training
interesting (if not fun) but also enables a manager to assess the level of an
employees understanding of the material. One role-playing scenario is for staff
to enact a problematic exchange between a patient/family and a nurse/clinical
caregiver.
4. Set safeguards. Without safeguards, things can go wrong. Knowledge is a
critical safeguard in healthcare. Physicians and nurses, for example, can spot
errors or potential problems in medications or treatment plans if they are
trained and expected to do so. Each person in the patient care process should
be trained to spot and correct errors.
168 Achieving Service Excellence
5. Hold employees accountable. Set measurements to see how well employees are
performing and how much more training they need.
Len Berry (1995, 191) expands this list with fve other strategies.
1. Focus on critical skills and knowledge
2. Start strong and teach the big picture
3. Formalize learning as a process
4. Use multiple learning approaches
5. Seek continuous improvement
Each of these methods is explored in this section. Berrys and Spaths recom-
mendations can serve as the basis for creating effective training programs.
Critical Skills and Knowledge
Critical skills are the capabilities required of all service employees. An organization
can identify these critical skills in two ways: (1) systematically analyzing the service
product, delivery system, service environment, and staff and (2) asking patients,
employees, and external experts.
Patients and their families can offer insights about the employee skills essen-
tial in satisfying customer needs, wants, and expectations, and employees can be
trained to pose this type of questions to patients. Dedicated employees (whether
clinical or support) are fully aware of the skills they possess, lack, and need for
their positions, so they are a natural source for developing training activities. Just
as in the case with leader development, employees must be invited or encouraged
to participate in designing their own training as they are on the front lines or the
receiving end of most customer service issues.
The Big Picture
The big picture includes the organizations overall mission, values, and culture as
well as the employees role in the organizations overall success. Typically, new em-
ployees are eager to learn how their jobs ft into the larger organizational context
(the big picture), what is expected of them in fulflling the mission, and how they
can help contribute to achieving the goals. This employee attitude reinforces the
need to incorporate the big picture into the training effort. Employees perform
Chapter 7: Customer Service Training 169
more effectively when reminded of the value they bring to the organization, in-
cluding the impact they have on customers.
In many organizations, this big picture reinforcement occurs only periodically,
mentioned at infrequent training sessions or at the annual company gathering. Un-
derstandably, the hectic pace of business makes losing sight of the big picture easy.
But through available means of communication (e.g., staff meetings, customer/
employee events, staff trainings, publications, intranet), leaders can regularly and
proactively educate or remind staff of the specifc ways they contribute to the or-
ganization.
For example, during the customer service turnaround efforts at Baptist Health
Care, leaders discovered that patient satisfaction improved signifcantly if patients
received a personalized phone call after discharge. Key staff members were trained
in when to call, what to say, and how to record the responses. In addition, employ-
ees were shown data that linked the increases in patient satisfaction with the uptick
in telephone follow-ups. Once staff realized the correlation between what they do
and what the hospital wanted to achieve, staff made time to make follow-up calls
regardless of their busy schedules.
After training, when an employee is confronted with a problem or situation
that is not covered in the employee handbook or a procedure manual, she should
be able to depend on the core values and service culture she learned and apply
those to the issue at hand. Because so many situations in healthcare are unplanned
and unforeseeable, teaching the big picture and the core cultural values is especially
critical. People who are taught the organizations values and beliefs from the frst
day are far more likely to make the right decision for the patient and the organiza-
tion when a situation calls for decisive action.
Formalized Learning
Formalized learning means
building staff training and development into the job,
making learning mandatory for everyone, and
institutionalizing that expectation.
For example, on a regular basis, organizations should send employees to at-
tend workshops, seminars, and other learning opportunities using company
(not employee) time. By putting their money where their values are, organiza-
tions send a strong message that continuous learning is vital and all staff are
expected to participate.
170 Achieving Service Excellence
Multiple Learning Approaches
Using various training approaches is important because people learn or process
information differently. No training opportunity should be left unexplored, and
relying on traditional methods is not enough. Organizations should also promote
learning through book clubs, site visits to exceptional service institutions, simula-
tions, role playing, skits, case studies, and Internet-based training.
Continuous Improvement
The employee orientation is the offcial frst training provided to employees. But
training should not stop there. Superb organizations and dedicated employees
both want continuing employee education and improvement, through on-the-job
training, supervision, shadowing, external classes, and online seminars, to name a
few methods. Cross-training also enables staff to expand their knowledge, skills,
and abilities, which in turn makes employees more exible and productive. Equally
important is that cross-training affords a department or unit to function normally
despite the absence of a staff member.
When an organization invests time and money into its employees continuing
education and improvement, it is conveying that it cares about the staff. The effec-
tiveness (or ineffectiveness) of the actual training may become an afterthought, as
employees recognize the organizations commitment to their personal and profes-
sional progress.
COMPONENTS OF A CUSTOMER SERVI CE
TRAI NI NG PROGRAM
Developing a training program necessitates an understanding of its different
components. These components are discussed in this section.
Needs Assessment
Needs assessment must always precede training so that perceived or observed prob-
lems and weaknesses may be identifed frst. These challenges then inform the
focus of the training. Needs assessment also answers the question, Will training
solve this particular problem? For example, some patients complain constantly
Chapter 7: Customer Service Training 171
about the slow and cold meal service at the hospital. At frst glance, the problem
may point toward the inability of the food service staff to prepare meals. A needs
assessment, however, may reveal that the real culprits are the old elevators, which
not only are slow but also do not have the capacity to carry a big batch of hot meals
at once. If the root of the problem is mechanical or nonhuman, then no amount
of staff training will correct the aw.
Needs assessment takes place at three levels: organizational, task, and indi vidual:
Organizational needs assessment seeks to identify the skills and competencies
the organization needs and to determine whether these skills already
exist. For example, if the needs assessment fnds that a unit can use more
nursing supervisors but no current employees can fll those roles, then the
organization can initiate a training program to prepare new or present staff
to become nursing supervisors.
Task needs assessment asks questions such as What tasks have to be done?
and Are duties being performed well, or is training needed? Most task
analyses in healthcare revolve around the clinical aspects of care, not the
customer service components.
Individual needs assessment reviews the job holders work to determine if her
performance is up to the established job standards. It also involves asking
the employee to name the areas in which she thinks she needs training.
Once needs at these three levels (i.e., organizational, task, and individual) have
been articulated, development of the training program can begin.
Heathfeld (2008) recommends following this needs assessment process for staff
who fll the same position (e.g., nurses, receptionists, billing personnel):
Convene a meeting with the employees who hold the same job. This
meeting should take place in a room equipped with a white board or ip
chart.
Instruct the employees to write down the ten training topics they need the
most. These needs must be specifc (e.g., how to manage an irate caller, how
to handle multiple tasks). Capture these comments on the white board,
making sure to avoid duplications.
Ask the group to prioritize the items listed on the board, using a
weighted voting process. In a weighted voting process, group members
(using a magic marker or sticky dots) assign a vote to each item they
perceive to be most important to their job. Members can vote as many
times as they like.
172 Achieving Service Excellence
Tally the votes. The item that receives the most votes is considered frst
priority, the item that garners the second-highest number of votes is named
second priority, and so on.
Jot down the selected priorities, and keep a record or notes of the meeting.
A laptop is handy for this exercise.
Schedule another session with the group for brainstorming. The next session
will focus on the desired outcomes and goals of the training, which will be
developed on the basis of the priorities named.
Also note one or two needs identifed by each employee, especially if they
are not selected as a group priority. These individual training needs may be
incorporated into the employees performance plan.
Training Objective
Needs assessment reveals an organizational, task, or individual defciency. As such,
the training objective should be to ensure that this defciency is flled. For example,
if patient comment cards show a general dissatisfaction with the effectiveness of the
personnel who register patients, then the training objective should be to improve
the staff s mastery of the registration procedures (assuming that the process itself is
sound and does not need to be redesigned). The objective must be directly tied to
the problem and must be measurable to enable improvement to be tracked.
Feedback from Physicians and Patients
Feedback from patients and/or the medical staff should serve as a trigger for train-
ing. These two groups serve as a check to employees performance, so if they notice
a defciency in knowledge, skills, abilities, or processes, they are often vocal about
their observations. Not all feedback is negative of course, but negative feedback can
leave a lasting impression on employees.
Effective organizations constantly measure and monitor the performance of
their staff (as well as their services, delivery systems, and setting), and feedback is
one method of monitoring. The faster a manager hears this feedback, the faster a
manager can institute corrective interventions, including training.
Presenting staff with current data on and future goals for patient satisfaction
sets the stage for customer service training. However, this data presentation may be
perceived as too impersonal, and the data may be too diffcult to explain and com-
prehend. In this case, the raw data may be personalized in some way. For example,
Chapter 7: Customer Service Training 173
at a staff training in one facility, a videotape of a focus group attended by former
patients and community members was shown. Instead of hearing the training facil-
itator read a transcript of the focus group or cite various customer ratings, training
participants were given a chance to watch the customers candid discussions about
their experiences at the facility (Baird 2000, 89). This kind of presentation had a
more powerful impact than a numbers-driven lecture would have had.
External Versus Internal Training
Training can be provided by persons inside or outside the organization. If the re-
quired training is in a general area or if only a few people are scheduled to attend,
an internal program will probably not be worth the expenditure, so those who
need training should be sent to an external trainer. Furthermore, many healthcare
institutions do not have the resources (e.g., budget, staff, physical space) for an in-
ternal training department, so they turn to training experts and consultants. These
external training companies range in size and scope, from small, highly special-
ized frms to large organizations that provide a wide assortment of topics in every
imaginable feld. Although many companies contract with training organizations
that develop and deliver customized, onsite training, others send their employees
to more generic and often less-expensive external programs.
Universities and colleges are another source of trainers. These programs em-
ploy faculty members who have academic training and/or management experi-
ence. Healthcare fnancial management techniques, information systems design
and use, and marketing strategies are examples of special courses frequently offered
by colleges and universities as well as professional associations. These programs are
relatively inexpensive because they do not have specifc application to a particular
organization.
Many standard customer service training seminars and workshops are offered
by professional associations such as the American College of Healthcare Executives,
the Medical Group Management Association, and the American Medical Associa-
tion. In-house training departments are widely found in large organizations, which
usually have an internal unit that provides training to employees. Management
consultants may be hired as well to establish a customer service training program.
Some organizations keep all training in-house to preserve organizational secu-
rity and culture. However, the typical determinant of whether to outsource train-
ing is cost. Training cost depends on the number of employees who need training,
the expense of transporting those employees from their current workplace (if the
organization has different locations) to a central training site, and the level of
174 Achieving Service Excellence
training needed (the greater the expertise, the greater the cost). In addition, highly
technical or specialized training costs even more. If only basic skills training is in
order, presenting the course in-house is more cost effective. Also, the organization
will likely hold the training internally if it involves many employees from many
work sites.
Measurement
Measurement allows the training to be evaluated so that it can be improved if it is
not accomplishing the goals. Ideally, the measurement will reveal whether or not
the content of the training has been transferred from the trainer to the trainee. Fol-
lowing are the four basic measurement methods available, ranging in expense and
degree of accuracy.
1. Participant feedback. This method is the cheapest and most commonly used
for assessing training effectiveness. It involves asking the participants to fll
out a questionnaire that asks them some general evaluation questions. Because
responses to these questionnaires often tend to reect the entertainment value
of the training rather than its effectiveness, they have relatively little usefulness
for accurate program evaluation. At least they tell you if the participants
enjoyed the training.
2. Content mastery. If the training goal was to teach a specifc skill, competency,
or content area, then the participants aptitude or understanding should be
tested afterward. This testing can be as simple as administering a paper-and-
pencil examination or as elaborate as requiring an on-the-job demonstration.
3. Behavioral change. Many people quickly forget what they learned in classroom
settings, especially if they do not apply it; they use it or lose it, as the saying
goes. As many college students admit, they learn a subject well enough to get
through the fnal exam and then they fush all the information out of their
brains. To be effective in any meaningful way, training must be followed by
real and lasting behavioral changes when the employee returns to the job. If
the training is well designed and anchored to mastering specifc service-related
competencies or skills, and the behaviors are reinforced by positive results or
what happens on the job, positive measurable behavioral change should result.
4. Organizational performance. Even if the training is well received, if the
employees remember most of it on completion, and if they continue to
use it on the job, the training is useless unless it eventually contributes to
overall organizational effectiveness in some tangible way. To maintain the
Chapter 7: Customer Service Training 175
organizations competitive position, the training objectives and the training
program require constant monitoring to make sure that they continue to
prepare employees to provide the level of service that ever-changing patients
expect.
Using all four basic measurement methods is useful to determine whether the
objectives of the training program were met. Each method is important because
each one contributes unique information. As you move up the organization chain
to higher job levels, the cost and diffculty of such evaluation increases. As a result,
each organization needs to carefully consider which evaluation methods should be
used for each program (Business Performance 2008).
TRAI NI NG METHODS
The most common training methods are classroom presentation, video instruction
(e.g., taped, live feed or streams), on-the-job supervision (e.g., residency, intern-
ship), independent/self-directed study (e.g., correspondence course), and com-
puter-based learning (e.g., webinar). Many training programs use a combination
of these methods, but emphasis has increased on computerized and multimedia
methods, given that computers have become ubiquitous. A survey of 1,200 white-
collar workers in 12 regions reports the following breakdown of training methods:
An instructor-led class or workshop (i.e., formal training) was the format taken
by 32 percent of respondents, while self-training via a trial-and-error process and
peer training was the approach taken by 31 percent of survey participants; 33 per-
cent completed a combination of both training methods (Danzinger and Dunkle
2005).
Classroom Presentation
Classroom training can follow a variety of formats, including lectures and interac-
tive case studies.
Lecture
In a lecture, the assumption is that the speaker is an expert and thus can discuss
all aspects of the subject and can provide insight or information pertinent to chal-
lenges faced by most, if not all, training attendees. Lectures are typically used when
the goal is to impart the same information to a large number of people at one time.
176 Achieving Service Excellence
Because they eliminate the need for individual training, lectures are cost effective
(Encyclopedia of Small Business 2007).
Aside from being inexpensive, lectures are also time effcient and direct to the
point. Lectures can supplement on-the-job training and mentoring to ensure that
the employee also gets background information and/or theory about the work.
Lectures have a number of potential drawbacks. Personality or any other type
of differences between the teacher and a student can disrupt the entire class and
its learning goals; worse, this problem can rarely be anticipated or avoided. Addi-
tionally, if the facilitator does not mediate the pace of the training, more advanced
trainees will get bored while beginning trainees may struggle to catch up (Stroisch
and Creaturo 2002).
Interactive Case Study
The purpose of this classroom training is to have an open discussion about a par-
ticular case, which is usually selected by the trainer or facilitator. The material is
relevant to an issue (e.g., defcient communication skills, barriers to workfow) that
staff have to improve, or it may address broad topics such as better decision mak-
ing or problem solving. In this format, trainees are active participants rather than
passive listeners.
The main beneft of the case study is its use of real-life situations. Because the
cases chosen for discussion are actual, the training becomes a practical learning
experience rather than a collection of abstract knowledge and theories that may be
diffcult to apply to the real workplace (Encyclopedia of Small Business 2007).
The case-study classroom format works with team training as well. Here, the
team (with or without a leader) explores a case that refects the teams current di-
lemma, and each member may be required to give insight and submit a solution.
Ultimately, this exercise can strengthen peoples group orientation and ability to
collaborate. In addition, team members discover and share a tremendous amount
of knowledge and talent among them. Even in highly specialized training areas,
teams can often teach each other specifc skills more effciently than a single in-
structor can, partly because the sum total of knowledge available in the group can
fll in the gaps regarding how the skill is supposed to be performed. Smart manag-
ers take advantage of team knowledge.
Video Instruction
Videos are frequently used in conjunction with a classroom presentation as a way
to bring in material for discussion or material that supports the trainers teaching.
Chapter 7: Customer Service Training 177
Video training enables learning to occur at any time, and it is cost effective. Video
instructions can be created by a healthcare organizations training department.
Alternatively, videos can be obtained through commercial training companies or
professional associations. Either way, the videos are inexpensive, convenient, and
relevant. For example, new employees can watch a video that describes the dos and
donts of patient interaction.
One advantage of video instruction is that it presents standard, consistent ma-
terial so that every trainee gets the same information regardless of when and how
many times the video is played. The main disadvantage is that video instruction is
typically not customized for a particular audience and offers no opportunities for
discussion (Encyclopedia of Small Business 2007).
A well-designed and well-produced video can do an excellent job of holding
the new healthcare employees attention, portraying outstanding role models of
expected service behavior, and stressing important points. With professional actors
in a video showing the correct means of providing patient service, a new employee
can see far more easily what the expected behavior is than if a trainer/lecturer
talked for several hours. Truly, a picture is worth a thousand words when it comes
to service training.
The making of training videos can function as an employee recognition and
reward. That is, the organization can assign its best employees to produce a video
of their job duties, highlighting ideal behaviors and interactions. Such an assign-
ment shows these staff that the organization appreciates the quality of their work,
respects their abilities, and views them as great role models for other employees. In
addition, participation in making a training video is enjoyable and enhances the
employees status within the department and the organization.
Another type of video instruction is the live video that is broadcast to the train-
ees through a satellite feed or streamed on the Internet. Distance learning (e.g.,
webinars) frequently relies on live video technology, which allows interaction be-
tween the trainer and trainees even when they are in separate locations.
New technology, diagnostic procedures, and clinical techniques are all appro-
priate subjects for live video streaming. As such, video training can be considered
just-in-time education that a rapidly changing environment such as healthcare
needs.
On-the-Job Supervision
One-on-one supervised experiences are a typical on-the-job training method in
healthcare. The trainee may complete an academic degree program and then be
178 Achieving Service Excellence
sent to a residency or internship program as part of the required preparation for a
healthcare career. In such training, a supervising manager or clinician demonstrates,
observes, corrects, and reviews the employee performing the required tasks.
This classic learning-by-doing approach is often essential in the healthcare in-
dustry; the skills required to render proper treatment are often so unique, complex,
or dependent on the needs of particular patients that the only effective training
method is to put new employees on the job and let them learn it by doing it under
close supervision.
On-the-job training programs follow a formal sequence, and a process com-
monly used in training is the job instruction technique. The job instruction
technique involves four steps for the trainer: (1) prepare to train, (2) present the
material, (3) ask trainees to apply the concepts by role playing or by on-the-job
demonstration, and (4) regularly follow up with trainees to ensure they are on track
(Encyclopedia of Small Business 2007).
Some medical schools train interns to empathize with patients by having the
students assume their patients conditions. For example, in one class at the Mayo
Clinic in Rochester, Minnesota, frst-year medical students played the Aging
Game to familiarize themselves with the physical circumstances faced by their el-
derly patients. Students were asked to wear goggles to simulate cataracts, ear plugs
to simulate loss of hearing, gloves to simulate arthritis, neck braces to simulate the
nearly universal muscular stiffness of old age, and diapers to simulate adult incon-
tinence (Okrent 2000). Then, with these items on, students were asked to read
the labels on prescription bottles and to count tiny pills with their fngers. By the
end of the courses term, the students were divided into two groups: residents in a
nursing home and workers at the nursing home. The residents were recipients of
the workers uncaring and poor service, including failing to bring food, shoving
spoonfuls of applesauce into mouths already flled with marshmallows, and ignor-
ing repeated calls for help (Okrent 2000).
These types of classes enable medical students to experience the care process
from the perspective of those they will care for in the future.
Computer-Based Learning
Computer-based training programs are designed to structure and present instruc-
tional materials and to facilitate the learning process for the student (Encyclopedia
of Small Business 2007). In other words, computer-based training can be both fun
and educational, reach all types of trainees, and accommodate cultural and linguis-
tic needs. Computers never get frustrated with a slow learner and will stay with
Chapter 7: Customer Service Training 179
the student until the educational goal is reached. That statement is still valid today.
Computer-based learning provides a number of advantages, including reduced cost
of training, instructional consistency, and wide access to trainees located in all parts
of the world (Encyclopedia of Small Business 2007).
Some behaviors and skills can be taught through computer simulation of actual
customer service scenarios. For example, the simulation could feature a patient
who is irate about food service and is now berating the staff member. The software
could offer several resolutions to this situation, and the trainee could pick the re-
sponse she thinks is most appropriate. The software then could score or grade how
well the trainee handled the scenario. Afterward, the software may present the ideal
solution and explain the reasoning behind it. This interactive program can also
offer rewards (in the form of points, perhaps) for good answers.
Computer simulation use shows the organizations commitment to patient ser-
vice and investment in the employees. Simulations help employees develop their
decision-making abilities, improve outcomes, and show the personal and organiza-
tional rewards gained from giving good service.
Even more exciting than simulations are the training opportunities available
on the Internet, which a decade ago made Cisco Systems state: One day, training
for every job on earth will be available on the Internet. As mentioned, streaming
training videos are now available on the Internet. With Internet technology and
accessibility, updates to training content posted on websites can be quickly and eas-
ily made. In addition, the Internet has evolved to become a repository for all kinds
of information, challenging and replacing the traditional repository of datathe
library. Because Web technology enables any user to supply content, a lot of in-
formation on the Internet cannot be called educational or reliable. Despite this
fact, however, it has become a training tool that rivals other nonvirtual educational
tools, such as colleges and universities and training corporations.
Healthcare providers beneft from computer-based training. These institutions
can avoid the expense of sending employees from different locations across the
country to a centralized training program by merely telling the staff to go to their
desks or a training room equipped with a computer with Internet access and/or
training software. The amount of information and knowledge that can be obtained
though this medium is enormous.
Other Training Methods
Training can be very specifc or somewhat general. The specifc is customarily used
for entry-level employees who must quickly learn to perform a job skill well to jus-
180 Achieving Service Excellence
tify their salary. General training can cover a wide variety of topics, ranging from
literacy to operating complex electronic systems. Some healthcare providers even
fnd it necessary to teach employees basic bathroom usage and hygiene, such as
teaching food handlers how to wash their hands.
Following are other methods of training geared toward service excellence that
can be either specifc or general:
Customer service retreats. Leaders and staff may go on a retreat that focuses on
enhancing customer service excellence. For example, New York-Presbyterian
(NYP) has developed a commitment to care philosophy that focuses on
service expectations for staff. These expectations relate to all staff interactions
(with patients, families, and colleagues) and are based on feedback from
patients. NYP rolled out these expectations in a staff retreat, allowing an
opportunity for staff to ask questions and even practice service behaviors
(Liebowitz 2008). Customer service retreats should be full-day experiences
to enable exploration of many customer service issues and to function as a
reminder to staff of the reasons they entered the healthcare feld (Liebowitz
2008).
Retraining. This method is often made available to employees who have
become burned out, have become unable to perform their current jobs
because of technological developments, or whose jobs have been eliminated.
The rapid pace of technological change in healthcare has made retraining
an increasingly important issue. Retraining strategies range from sending
employees back to school to providing on-the-job instruction in new
procedures. Some organizations, like those selling laser eye surgery equipment,
send medical doctors to the buyers to teach proper procedures.
Role playing. This method helps staff learn how to best relate to customers.
Different scenarios can be role-played for addressing a given customer
service problem or issue, and then participants can select the most
effective approach and role-play it. One example might be a patient who
wants to go home today but needs to stay one more day. A question to
consider in this scenario is: What are the options for communicating
the doctors orders and their rationale to the patient? The different
approaches can then be role-played to determine the most effective one.
Other examples might include what to do or say when the patient, a
physician, or a family member is angry or when a patients family makes
a request that is contrary to policy. Role playing can be helpful in dealing
with situations such as the following:
Chapter 7: Customer Service Training 181
1. How to advise patients or physicians that their requests cannot be granted
2. How to deal with angry or diffcult patients and other customers
3. How to praise patients and motivate them to continue desirable behavior
4. How to recognize unacceptable staff language and behaviors
5. Where and how to voice concerns and problems
6. What not to say in the presence of patients
7. How to address patients and other customers
Orientation. This training is for new employees and can include a segment
on customer service that covers the organizations mission and vision, the
importance of customer satisfaction, measurement of customer satisfaction,
the new employees roles, customer service standards, and the link between
customer service standards and performance reviews.
Cross-functional training. This method enlarges the workforces capabilities to
become multiskilled healthcare practitioners. For example, a Florida hospital
developed a patient-centered healthcare delivery system that relies extensively
on multiskilled practitioners to perform a wide range of tasks to meet patient
needs. As a result, patients receive just as much care but from fewer people.
Employeepatient bonding has therefore increased, and patient satisfaction
has risen to record levels. Cross-functional training provides task variety and
higher interest levels for employees, which has signifcant benefts in improved
employee motivation and morale. Cross-functional training is clearly a
winwin situation for patients, healthcare organizations, and employees.
Special competencies training. This method focuses on working as a team,
creative problem solving, communications, relationships, and service
orientation. Organizations using it realize that having clinical skills is only
part of the service requirement for their employees. They know they must
also show their employees how to handle the many types of relationships
their patients will expect of them and how to solve the many problems that
inevitably occur when different patients bring their different expectations to
the healthcare experience.
Diversity training and attitudinal training. These types of training focus
on changing how employees view and interact with other employees and
customers. With the changing cultural makeup of many communities, a
heightened awareness of the issues, challenges, and opportunities faced by
minorities is essential for those who provide healthcare services. As Rutledge
(2001) reminds us, training is needed to ensure that caregivers recognize that
the one size fts all approach does not work because all healthcare customers
182 Achieving Service Excellence
have unique life experiences and histories that inuence the nature and
effectiveness of their participation in and interaction with healthcare delivery
systems and providers. In todays competitive marketplace, healthcare
organizations must educate their employees regarding such issues to expand
services and programs to accommodate new markets.
Selecting a Training Method
Stroisch and Creaturo (2002) offer the following practical suggestions for selecting
a training method:
Size of audience. A larger audience often requires more formal training
methods with less audience participation.
Maintaining attention through interaction. Training methods that involve the
trainees in the instruction have the advantage of maintaining attention and
allowing all participants to be involved.
Variety. Selecting and using various methods within a program often maintain
the interest of the trainees.
Available resources/infrastructure. When resources are limited, the opportunity
to use resource-intensive techniques, such as feld visits and demonstrations,
may also be limited.
Duration of training session. Training methods that involve discussions and
casework take longer than more lecture-oriented methods.
Experience of the trainer. The trainer must be comfortable using the chosen
method.
Training aids. Aids support the learning method and make the material more
accessible.
Albrecht (2004) recommends that the following four ingredients be incorporated
into the training method selected:
1. Theory. The essential data, information, and knowledge required to deal with
a particular performance situation. It includes concepts, models, reference
information, key facts and fgures, and principlesall the elements that
serve to inform a persons actions associated with a particular competency.
Competency can range from simple facts to a complex set of concepts,
principles, and/or protocols.
Chapter 7: Customer Service Training 183
2. Instruction. The how-to part of the learning, specifying the actions, methods,
procedures, rules, and decisions needed to deal with the performance
challenge being learned.
3. Modeling. Providing observable examples of competent action. Examples
include watching, hearing, or interacting with a person skilled in the desired
performance, or observing an outcome or fnished product.
4. Experience. The actual doing of the target behavior, under circumstances
similar to those under which the performance challenge will typically arise,
and with assessment and immediate feedback.
PROBLEMS AND PI TFALLS OF TRAI NI NG
Common problems with training include failure to establish training objec-
tives, measure results, and analyze training costs and benefts (Business Perfor-
mance 2008):
1. Not knowing the training objectives. Training programs can run into
trouble if the precise nature and objective of the training are unknown
or imperfectly defned, or if the outcome expected of the training is hard
to defne or measure. Such programs are hard to justify or defend when
senior management reviews the training budgets. Typical examples of areas
in which the effectiveness of training is diffcult to measure are human
relations, supervisory skills, and customer service. Because these terms are
vague and situationally defned, knowing what and how much training to
offer to improve effectiveness in these areas and how to measure results is
diffcult. Healthcare organizations quite naturally want their employees to
have a service orientation, but the concept is hard to defne, as is determining
whether the training has resulted in such an outcome. What exactly that
training should be and whether it is effective are much more diffcult to
determine.
2. Not performing before-and-after measurement. Although questions about
effectiveness are diffcult to answer, organizations should try to answer
them. One measure of change in, say, patient-service orientation might
be the number of patient complaints before and after training. Another
approach is to use paid mystery shoppers to sample the level of service,
both before and after the training. The point of any technique is to
measure the value added by training. Without a before measurement,
184 Achieving Service Excellence
the organization has little way to know if the measurement after the
training represents any improvement. Here, larger organizations have
an advantage, as they can use different parts of the organization to test
different types of training and statistically determine whether or not one
training type is more effective than another in terms of reducing patient
complaints or increasing positive comments. Another strategy might be
for the organization to measure the attitudes of its own employees toward
patients, both before and after the training. Because we know that the
correlation between the attitudes of healthcare patients and employees is
positive, employee attitude may in general suggest how patients perceive
the service level.
3. Not analyzing costs and benets of training. Training programs have obvious
direct costs, but they involve indirect or opportunity costs as well; the time
that trainees spend away from their regular duties also costs money. Training
is too expensive for the organization to train everybody in everything, so it
must try to get the best value for its money by using those training programs
that can be shown to give the greatest positive results in customer service
and patient satisfaction for the training dollar expended. All too often,
organizations are at the mercy of consultants selling programs of unproven
usefulness and value. Organizations should make the effort to ascertain the
value of each training program, whether internal or external, in terms of
whether it results in greater patient satisfaction.
STAFF DEVELOPMENT
Training typically focuses on teaching staff how to do new jobs for/into which they
have been hired/promoted or to overcome defciencies they may have in perform-
ing their current jobs. Development, on the other hand, is typically focused on
getting people ready for their future. Training looks backward to identify and cor-
rect employee defciencies in performing the job today. Development, on the other
hand, looks forward to identify the skills, competencies, and areas of knowledge
the employee will need to be successful tomorrow.
The challenge with employee development is that knowing what the future
will bring is diffcult. Therefore, employee development programs tend to be more
general, so measuring them and evaluating their effectiveness is even more diffcult
than for training programs.
Chapter 7: Customer Service Training 185
Tuition Reimbursement
A good example is the traditional tuition-reimbursement policy many organiza-
tions use to encourage employee development. Is the organization doing the right
thing for itself or its employees if it refunds tuition only for those courses that are
directly related to the employees existing job, or is it doing a better job if it pays
for any legitimate course at any legitimate educational institution? In the frst case,
the policy looks quite practical as it underwrites courses that directly enhance the
employees ability to do a current job. On the other hand, paying for any course re-
gardless of feld expands the total pool of knowledge available to the organization.
Consider a group of people studying different topics in different majors who
are brought together in a quality circle or problem-solving session to work on an
organizational matter. This groups total knowledge will obviously be greater than
if everyone had gone through the same educational program or had majored in the
same subject. A variety of learning experiences expands the creative potential of
both the employee and the organization and therefore increases the possibility of
new and innovative ways to perform now and in the future.
General Education
Supporting any legitimate employee effort to improve, grow, and learn is in the
employers interest. Such support sends a message to employees that the organiza-
tion values their potential as much as it values their current contributions; it is
also a relatively inexpensive employee and organizational development strategy.
More important, it supports a learning environment. An organization that actively
promotes learning of all kinds sends a powerful message to its employees that it be-
lieves the only way it will stay competitive is to continuously learn. These learning
organizations promote the active seeking of new knowledge that not only benefts
the individual but benefts the entire organization by building its total pool of
knowledge.
No matter how irrelevant the material may seem, the creative employee will
use it to make organizational connections. The organization will eventually beneft
from whatever creativity the educational experience spurred and from the increased
loyalty and feeling of support that any employee gets from working for an organi-
zation that supports employee education. Forward-looking organizations under-
stand that most of their revenues in ten years will be from products or services that
they do not even know about today. Educational reimbursement programs that
186 Achieving Service Excellence
restrict people to those courses that the organization thinks are important today
may be as silly as trying to predict which healthcare services will be important ten
years from now.
Career Development
A good employee-development program should also include career development.
Few people picture themselves doing the same thing in the future as they are doing
today. An organization concerned about customer service should pay careful atten-
tion to its current employee-development efforts so that the people who are help-
ing the organization meet customer needs today are prepared to continue doing so
in the future.
Employees tend to believe that the longer a person is with an organization,
the more that person is worth to it. Many organizations support that belief by
celebrating anniversary dates with parties and pins to show that the organization
recognizes and appreciates the employees commitment.
Pins and parties, however, are not enough. The outstanding service organiza-
tions recognize that the individuals need for personal growth and development
must also be satisfed by permitting the employee to travel along a well-designed
career development path.
The entry-level healthcare manager should be able to see a path to the CEOs
offce that can be successfully traveled with hard work and dedication. The out-
standing organizations provide career paths that give talented, ambitious people
the opportunity to realize their dreams. The opportunity is symbolically impor-
tant, even if not all employees choose to take advantage of it.
Mentoring
Mayo Clinic, MD Anderson Cancer Center, and the Veterans Health Admin-
istration are among the healthcare facilities that offer fellowship opportunities
to recent graduates of masters in health administration programs. Fellowships
allow senior-level executives to mentor young people who are just beginning
their careers.
Typically, in a fellowship or mentorship program, inexperienced employees are
paired with those with more tenure in an effort to encourage mutual learning and
growth, both personally and professionally. In addition, mentors can serve as a
sounding board for their protgs and can offer job coaching and career advice.
Chapter 7: Customer Service Training 187
In this way, protgs gain a better understanding of their job roles, responsibili-
ties, and expectations. Protgs are not the only ones who beneft from a mentor
relationship; mentors gain valuable insights from their protgs and in the process
become better managers (Levine 2008).
CONCLUSI ON
Employee growth can be facilitated by means of the many training and development
techniques covered in this chapter. Organizations should give employees who have
knowledge, skills, and abilities and who are willing to work hard the opportunity to
grow personally and professionally. Career paths should be available and visible, and
continuous learning should be encouraged. In fact, the philosophy that lifelong learning
can lead to advancement should be an important part of the organizations culture.
Staff training and development begins with leadership development. Leaders
must be the role models of career development. Ignoring the needs of employees
to learn and develop may be a cost-effective strategy in the short run, but it is ex-
pensive in the long run. Simply, if employees are not growing, the organization is
also not growing. The best employees leave this type of environment to offer their
talents to an employer who can develop them.
Development is not just for staff. It is also a must for leaders, as leaders set the
tone for the rest of the organization.
Service Strategies
1. Teach employees not only job-related skills but also interpersonal skills and
creative problem-solving techniques related to customer service.
2. Use scripts related to customer service to teach staff how to respond to
customers in a given situation.
3. Do not just train to be training; know what outcomes you expect from
your training dollars, and measure your training results to ensure you get
them.
4. Before training people, check the service delivery system; the problem may
lie there.
5. Develop both leaders and staff for your organizations future.
6. Do not just believe in your people; champion their training and
development.
188 Achieving Service Excellence
7. Reward behaviors learned through training to keep them alive.
8. Relate training to employee job responsibilities, especially those related to
customer service.
9. Make training and development in customer service an ongoing process.
189
Leaders think about empowerment, not control.
Warren Bennis
C H A P T E R 8
Motivation and Empowerment
Service Principle:
Motivate, empower, and reward employees
for achieving customer service goals
In almost all healthcare experiences, the patient-contact employees make the
difference between a satised patient and a dissatised patient. Therefore, employ-
ees who provide the healthcare experience must not only be well trained clinically
but also highly motivated and empowered to meet the patients expectations and
to do so consistently. A healthcare managers leadership and managerial skills can
inuence employee attitudes greatly and are vital to employee empowerment and
motivation.
In this chapter, we address the following:
Motivating, satisfying, and rewarding staff
Developing work teams
Empowering employees to identify and solve problems
MOTI VATI NG EMPLOYEES
The challenge for healthcare managers is to discover what makes employees not
only do their jobs efciently and competently but also want to go the extra mile.
Consider the following scenarios:
190 Achieving Service Excellence
For some time, a nursing home resident has been eating less and complaining
more than usual. His exasperated family thinks his complaints are just
another tactic to get attention, but an observant employee suspects the
patients reluctance to eat might have a physical cause and arranges for him
to see a dentist. The dentist conrms the employees suspicion: The residents
dentures are causing his discomfort, pain, and inability to eat. The situation is
corrected, and the thankful resident begins eating regularly again.
A chemotherapy patient is happily anticipating a trip to a dear friends
wedding, which was scheduled between chemotherapy treatments, when
the patient could comfortably travel the long distance required. Then an
attending nurse informs the patient that her high white blood cell count will
require a change in the chemotherapy schedule, and the patient realizes she
will not be able to go to the wedding. The attending nurse sees the look of
dismay on the patients face and asks the doctor to rearrange the treatment
schedule. The change is made, and the patient attends the event and has a
wonderful time.
In these examples, the nursing home employee and the chemotherapy nurse
took a creative path to solving their patients problem not because they had to but
because they wanted to. Something or someone motivated these healthcare profes-
sionals to go above and beyond their clinical responsibilities and job descriptions to
provide extra service to their patients. Benchmark healthcare organizations benet
from using the whole employee, from the neck up and from the neck down.
Every healthcare experience is unique, and any manager who believes it is pos-
sible to predene policy and procedures for handling any and all healthcare expe-
riences is mistaken. Employees should know they are encouraged, expected, and
trusted to handle all the varied situations that come up in the patient-service areas
for which they are responsible. Presuming they were properly selected and trained
in the rst place, management must make it possible for them to do their jobs with
responsibility, skill, enthusiasm, and enjoyment. But how?
The answer is simple. It is based on the well-accepted psychological principle
that behavior that is rewarded tends to be repeated, and behavior that is not re-
warded tends not to be repeated. Implementing the answer, however, is the chal-
lenge facing every manager. The way to keep healthcare employees performing at
high levels is to reward behavior associated with excellent healthcare experiences
and to refrain from rewarding behavior that is not. In an intensely personal eld
such as healthcare, acknowledgment of employee contributions is extremely im-
portant (Studer 2008).
Chapter 8: Motivation and Empowerment 191
Finding the right reward is the hard part. Employees are as varied as patients.
Just as patients differ in what they expect in terms of care, employees differ in what
they expect in terms of rewards from their organizational relationships. In a sense,
employees are the managers customers. Employees defne the value and quality of
the employment relationship, just as the customer denes the value and quality
of the healthcare experience. The managerial challenge is to determine the types
of rewards each employee believes are equitable and appropriate, whether service
awards, recognition for suggestions and improvements, or other incentives that
recognize employees for serving customers well. Finding the right reward can be
difcult because, over time, employees expectations, moods, and valuations of the
employment relationship change.
For the most part, healthcare employees look for four things in a job beyond
the basics of competitive pay and benets. It must be fun (in the sense of enjoy-
ably fullling), fair, interesting, and important. Top organizations recognize that
great employees are more likely to stay if they are allowed to have a little fun at
work. For example, the unoffcial mission of Paradigm Communication, a soft-
ware developer, is have fun or get red. The companys owner also enforces a
simple dress code and attendance policy: Show up for work, and wear something
(McCann 2009).
Of course, many healthcare situations are no fun for anybody. Performing a
clinical procedure that will be painful for the patient or telling a parent that a child
is terminally ill is stressful and agonizing for a healthcare worker. Nevertheless,
performing the overall job and accomplishing its goals should be fullling and
enjoyable, if not exactly fun.
From an organizational perspective, the key to managing and retaining employ-
ees is to create job situations that employees perceive as fun, fair, interesting, and
important. If the organization can successfully build these elements into the job
situation, employees will be motivated to work hard and satisfy customers. The
managerial challenge is that everyones denition of these four traits is different.
Exhibit 8.1 indicates how healthcare managers can become transformational
leaders to move their organization or unit toward outstanding customer service.
They should start by rst being effective transactional leaders. Peoples basic needs
must be handled well in any successful organization, but there is more to a suc-
cessful organization than a good pay plan, safe working environment, job security,
competitive benets, and working equipment. Truly successful organizations are
also effective at nding ways to provide jobs that are fun, fair, interesting, and im-
portant (see Exhibit 8.1). This is how transactional administrators become trans-
formational leaders.
192 Achieving Service Excellence
Fun
Fun is essential at work, because happiness is contagious. Employees who have fun
tend to be less stressed and easygoing, qualities that spread to other people, includ-
ing customers. Research has shown that customer calls made by employees who
have a smile on their face are more likely to have a successful outcome than calls
made by frowning or unhappy employees. A fun work setting improves employee
retention, morale, and recruitment (Ford, McLaughlin, and Newstrom 2004).
Fair
The second contributor to a motivated workforce is fairness (Fulford 2005; Barsky
and Kaplan 2007). People who are fairly treated are more motivated to perform
on behalf of their organization than those who think they are not fairly treated.
People compare the ratio of their outputs (what they get out of their effort) to their
inputs (what effort they put in) with other peoples ratio of outputs and inputs. If
an employee thinks his outputinput ratio is in line (he gets as much as he puts in)
and is about equal with that of others, then he is satised. If the employee perceives
he is getting less than deserved, he feels abused.
Exhibit 8.1 Motivating Mission-Focused Employees
Job is Because
1. Fun Fun work environments communicate the organizations respect and
appreciation for its employees; happiness is contagious.
2. Fair Equity is important to workers as they compare what they are getting from
the organization in terms of pay, benets, development opportunities, and
so on with what others are getting both inside and outside the organization.
3. Interesting
Job content:
Job context:
The job has autonomy, and workers are empowered and responsible for
their own performance, work methods, and achievement of job goals.
Work team and culture make the organization a friendly, supportive, and
good place to work.
4. Important The job has value in an organization with a worthwhile purpose that is
valued by key stakeholders.
Chapter 8: Motivation and Empowerment 193
Employees who feel abused tend to steal, call in sick more often, and have low
morale (Fulford 2005). Their unhappy attitude and demeanor are displayed to cus-
tomers. On the other hand, employees who deem that they are paid more or given
better benets than their peers may feel guilty and opt to work harder (although
not necessarily smarter), come to work earlier, or stay later to justify what they
receive. However, such a reaction is temporary. Soon enough, these employees will
come to believe they deserve everything that comes to them.
Employees want to be treated fairly by the organization, and successful manag-
ers seek ways to ensure this. The difculty for a manager is not knowing the input/
output measures that employees use to compare themselves with others. Managers
must be alert to these comparison factors. Nothing undermines an employees per-
formance faster than a feeling of inequitable treatment.
Interesting
The third contributor to employee motivation is how interesting people nd their
jobs. Obviously, managers strive to hire skilled people who want to perform their
functional responsibilities, and this desire can be motivated by intrinsic and extrin-
sic rewards most important to these people. After functionally qualied people are
hired, however, the challenge becomes how to keep them interested in consistently
and continually performing the specics of their job.
No two employees are alike, but most employees share a common motivator.
First, the job must provide an ongoing opportunity for learning and growth, both
personally and professionally (Fiorito et al. 2007). People want to gain mastery in
their area of interest, as it leads to increased personal ownership of their work and
professional acknowledgment and respect for their knowledge, skill, and abilities.
Second, the job must present an opportunity for group work (Fiorito et al. 2007),
a concept discussed later in the chapter.
Important
Importance is the fourth motivating factor. This is an employees perception that
her job and performance play a key role in the organizations ability to fulll its
mission. If the community views the healthcare organization as a major contribu-
tor to the economic growth, health, and wellness of the community, the employees
will feel proud of their association with the institution and their professional and
194 Achieving Service Excellence
personal input into this greater good. Simply, employees want to feel that what
they do is valuable because it benets other people.
Studer (2008) agrees that this perception of the job as important can lead to
worker satisfaction. He expands this idea with three more employee desires (Studer
2008, 146):
1. Employees want to believe the organization has the right purpose.
2. Employees want to know their job is worthwhile.
3. Employees want to make a difference.
SATI SFYI NG EMPLOYEES
Great leaders motivate staff, develop their talents, provide them with proper re-
sources, and reward them when they succeed. If healthcare managers and supervi-
sors offer appropriate incentives and fulll employee needs, then employees will
fnd their jobs to be fun, fair, interesting, and important; they will be satisfed in
their work.
If employees are satised, they are much more likely to try to meet the needs
of the customers they serve. Customer satisfaction obviously translates into a posi-
tive relationship with the healthcare organization, which translates not only into
positive word of mouth but also community support and revenue enhancement.
These interrelationshipsthe importance of leaders to employee satisfaction and
the importance of employee satisfaction to customer satisfactionmake intuitive
sense and are supported by research (Studer 2008).
Recent research by Zeithaml, Bitner, and Gremler (2008) supports the relation-
ship between employee satisfaction and customer satisfaction and suggests that
satised employees make for satised customers and satised customers may then
reinforce employees sense of job satisfaction. Unless service employees are happy
in their jobs, customer satisfaction will be difcult to achieve.
Intervening When Necessary
Managerial intervention can turn a negative employee situation into a satisfying
experience. Consider the case of a conscientious, hardworking nurse in a childrens
hospital. The nurse is a single mother with school-aged children, and she frequently
misses work because of childcare issues. As a result of her absences, the nurse man-
ager has informed her that she is being written up. She was already worried about
Chapter 8: Motivation and Empowerment 195
losing her job, and this latest reprimand makes her feel insecure about her liveli-
hood. Her personal problems and the threat of termination will likely have a nega-
tive effect on both the quality of service and the clinical care she provides.
This situation gives the nurse manager an opportunity to turn a negative situa-
tion around. What can the manager do to effect a change that will satisfy the nurse
and the department? We offer the following step-by-step approach.
1. Diagnose the problem. The manager can determine the exact nature of the
nurses absences through facilitative listening. During this process, the
manager should concentrate on actively listening, instead of giving advice,
instruction, or solutions to the problem or, worse, interrupting.
2. Clarify goals and expectations. Specically, the manager should discuss the
organizations mission, vision, and goals and the departments expectations
related to attendance, punctuality, patient care, customer service, and so
on. Also, the manager may explain the rewards and penalties (including
discipline and dismissal) for achieving or failing to meet these expectations.
More important, the manager should relate all of these organizational and
departmental goals and expectations to the nurses specic job so that she
can better understand how her role, behavior, and performance affect the
functioning of the enterprise as a whole.
3. Empower the employee to come up with the solution. In this case, the nurse
should be responsible for working out her childcare problem, and the
manager should offer input and support as necessary. The goal here is to
reach a resolution that is practical, achievable, and mutually satisfactory for
both parties. If improvement occurs within the agreed-upon deadline, the
manager may encourage continued progress by providing a personal note of
congratulation or thanks for the nurses efforts.
Coaching Versus Evaluating
A primary purpose of the traditional performance appraisal is to instill in em-
ployees the desire to improve their performance. Yet performance improvement
often fails to occur for at least three reasons (Latham and Mann 2006). First, the
appraisal is typically done on a xed-interval basisannually, biannually, or quar-
terly. Consequently, the feedback on performance that employees need to act on is
often given too long after the fact. Second, because of myriad job duties, the typi-
cal manager cannot observe all her direct reports at all times. Consequently, many
employees perceive their manager as an inadequate source of feedback about their
196 Achieving Service Excellence
performance. Third, and arguably worse, many employees think their managers
appraisals are biased. Consequently, staff are not inclined to change their behavior
or performance on the basis of their supervisors evaluation alone.
In the past decade, the prevalent view of a performance appraisal has been that
it is conducted to fulll an administrative requirement, not promote professional
development. In fact, documented job evaluations can serve as a legal defense for
promotions, demotions, terminations, transfers, layoffs, increase or decrease in sal-
ary, and other human resources activities that may be challenged.
Coaching has become the modern way of promoting career growth. It over-
comes many of the problems faced in the traditional appraisal because it
provides ongoing feedback,
supports goal setting,
clarifes the relationship between the job performance and the job
expectations, and
inspires the employee to take action to improve job performance.
As new generations of employees enter the workforce, the value of coaching will
become even greater. Almost everyone wants feedback, but almost no one wants to
hear negative feedback based entirely on a managers subjective judgment. Coach-
ing, in conjunction with the development of validated evaluation tools, allows
managers to guide employees to help the organization achieve its mission.
As an unpublished study by one of the authors suggests, a mystery shopping ap-
proach can be used effectively for coaching. Mystery shoppers provide information
that is objective, unbiased, and rmly anchored on key performance standards.
Using such data allows the manager to coach, rather than judge, and thus to focus
on desired behaviors rather than blame.
Asking Employees About the Factors That Motivate and Satisfy Them
Again, the most effective way of nding out what satises employees is to ask them.
A well-designed employee survey can yield direct answers about staff s perception
of the available motivators in the organization. Such a survey ought to assess em-
ployees career interests and goals, identify changes that might improve working
conditions and job satisfaction, determine the level of employee recognition and
rewards, and name the key drivers of staff motivation (e.g., promotions, exible
work schedules, autonomy, increased responsibility, recognition, salary).
Chapter 8: Motivation and Empowerment 197
In their Baldrige applications, award winners Mercy Health System in Wiscon-
sin and SSM Health Care in Missouri report conducting such surveys regularly
and systematically. Yale-New Haven Hospital in Connecticut surveys employees
every two or three years. Similarly, at Baptist Health Care in Florida, a systemwide
employee task force conducts focus groups to gather information that can be useful
in structuring employee incentive programs.
Baptist Health Care surveys all of its employees every two years and conducts
mini surveys every 90 days on the job aspects they know lead to job satisfaction or
dissatisfaction, such as employees relationships with their supervisors and employ-
ees feelings about pay and working conditions.
The organization understands the direct relationship between employee satis-
faction and morale, turnover, and quality of the healthcare experience. Managers
whose employees have low satisfaction scores are reminded of the low scores in
their performance evaluations and compensation. The satisfaction scores are also
posted for all employees to see. Employee satisfaction has led to increased patient
satisfaction and productivity at Baptist Health Care.
Exhibit 8.2 lists 12 questions that measure key factors associated with attract-
ing, focusing, and keeping employees satised with the job and the organization.
The questions are based on extensive work by the Gallup organization conrmed
Exhibit 8.2 Questions Assessing Core Work Elements
1. Do I know what is expected of me at work?
2. Do I have the tools, materials, and equipment I need to do my job right?
3. At work, do I have the opportunity to do what I do best all day?
4. In the past seven days, have I received praise or recognition for doing good work?
5. Does my supervisor, or someone at work, seem to care about me as a person?
6. Is there someone at work who encourages my development?
7. At work, does my opinion count?
8. Does the mission or purpose of my company (organization) make me feel my job is
important?
9. Are my coworkers committed to quality work?
10. Do I have a best friend at work?
11. In the past six months, has someone at work talked to me about my progress?
12. This past year, have I had the opportunity at work to learn and grow?
198 Achieving Service Excellence
by a meta-analysis on more than 100,000 managers in 24 companies (Buckingham
and Coffman 1999). Still valid and valuable in todays workplace, the list suggests
that employees do not quit organizations, but they do quit their managers. As
mentioned in Chapter 5, transformational managers know this simple fact and
strive to get the answers to such questions so that the right people who can help
the organization fulll its mission are retained.
REWARDI NG THE DESI RED BEHAVI OR
Most managers focus on their problem employees and tend to ignore those who
perform competently. Their employees quickly learn that the squeaky wheel gets
the grease. Rewarding the wrong behavior is as big a mistake as not rewarding
the right behavior. The organizations reward system needs to be constantly and
carefully reviewed to ensure that the behaviors being rewarded are aligned with the
behaviors that the organization supports.
For example, many hospitals say employees should make every effort to satisfy
the patients, but many of these same hospitals evaluate and reward employee per-
formance only according to the budget numbers and clinical results. This practice
has been called rewarding A while hoping for B. Most employees will natu-
rally focus on the numbers and not on the patient-satisfaction ratings. Similarly, if
healthcare managers tell employees that team performance is important but only
reward employees as individuals, employees will realize that team effort does not
really matter that much.
For example, say a hospital hires Roberta Hunter to serve as a receptionist
at the hospitals information desk. The manager tells Roberta explicitly that
her primary responsibility is to greet and welcome patients and their families
and to provide them with any information they need. As time goes on, how-
ever, to keep Roberta busy when patients are not entering the hospital, the
manager adds responsibilities to the position: doing routine but important
paperwork.
Roberta quickly realizes that the manager never compliments her for cheerfully
greeting patients or giving helpful information, nor does the manager say any-
thing when she does not speak with a customer promptly because she is too busy
with other duties. But if Roberta fails to get the paperwork done, she is strongly
reprimanded. By action or lack of action, the manager has redened Robertas job
description. By his actions, the manager has made the real priorities clear, and Ro-
berta adjusts her actions accordingly.
Chapter 8: Motivation and Empowerment 199
Identifying the Rewards
Managers must learn techniques that accurately identify the rewards employees
want. Quint Studer (2008, 16368) calls this process knowing your employ-
ees whatthe factors that workers perceive to be rewards, which promote
motivation and commitment. He suggests finding out these needs by the fol-
lowing means:
Conducting an employee satisfaction survey
Paying attention to issues during daily or weekly rounds
Sending out a whats your what e-mail to all employees
Asking each employee directly
Well-designed employee questionnaires, such as Exhibit 8.2, can make manag-
ers aware of the rewards most likely to motivate or satisfy a given category of em-
ployees. Effective performance is a result of employees being rewarded in ways that
recognize both what they personally value and what their work contributes to the
organization. These rewards keep them energized to perform their jobs efciently
and enthusiastically.
As mentioned in previous chapters, one form of reward that has been success-
ful in enhancing employee retention is exible scheduling. AARPs 2008 Best
Employers for Workers Over 50 included two healthcare organizations that offer
fexible scheduling: Inova Health System in Falls Church, Virginia, and SSM
Health Care in St. Louis, Missouri (AARP 2008).
NECESSARY MANAGERI AL SKI LLS
Managers must have certain skills to support and motivate employees, including
both the administrative transactional and the leadership transformational skills.
Administrative or transactional skill is the ability to take care of routine tasks,
including paperwork, administrative procedures, and policies that directly inu-
ence each employees ability to perform the job. A manager who forgets to submit
the proper payroll, who fails to provide the necessary information for employee
decision making, or who schedules too few people to work in the emergency de-
partment on a Saturday evening creates situations in which even the most enthu-
siastic, energetic employee cannot succeed. Managers must effectively administer
the basic job-related requirements of employees.
200 Achieving Service Excellence
Transformational leadership skill is the ability to identify and provide the
rewards individual employees want to move the organization to a higher level of
performance along some dimension. It often means transforming some aspect of
the organization to better align it with the changing external environment (i.e.,
changing some aspect of the culture). Although fear and the threat of punish-
ment may be powerful short-term motivators, the ability of the organization and
its managers to fulll employee needs is what yields energetic employee commit-
ment to organizational goals in the long run. What managers offer in return for
employee contributions are inducements that make the job fun, fair, interesting,
and important; are fairly distributed; and affrm the jobs value to the organiza-
tion and society. These inducements can be referred to as eager factors.
Eager Factors
What makes employees eager to join the organization in the rst place? People join
organizations to fulll their needs. Although individual needs are innitely varied, they
usually include the need for nancial security, the need to belong to an organization
that matches and enhances ones self-image, the need to associate with people who
think and feel the same way, and the need to grow and develop as a person and as an
employee. Although every organization will have poor performers, most people work
hard when they are doing what they love in a job that satises their needs.
Salary
Financial compensation policies should be carefully designed. Competitive salary and
benets are important to any worker, but pay is not the only driver of good performance
or willingness to stay. Sometimes, pay could present a negative snowball effect. Consider a
group of employees who receive a bonus for successfully completing a project. The group
will probably be highly motivated to perform on the next project, perhaps even doing
a better job. If their performance on the next job is of higher quality and they receive a
lower bonus or no bonus, their motivation for future projects may decrease.
Sense of Belonging
Many years ago, studies at the Hawthorne Plant of the Western Electric Company
showed that a sense of belonging or not belonging greatly inuences what people will
or will not do in the workplace. Well-formed work groups can help managers give
direction to employees and guide behaviors in the workplace. To this end, managers
Chapter 8: Motivation and Empowerment 201
should work in harmony with the group and support its efforts, because the accom-
plishment of the groups goals facilitates the achievement of the organizations goals.
If a group offers its members an opportunity to achieve something greater than
individual members could alone, then the groups value to its members becomes
greater than merely satisfying peoples belonging needs. Membership in a group
with a strong corporate culture and a widely respected mission is benecial for
both the individual and the group. This esteemed and admired mission becomes
itself a powerful tool for motivating and retaining the members. The concept of
team is discussed further in the next section.
WORK TEAMS
By nature, healthcare work can profoundly change peoples lives. Healthcare
workers who understand this fact and are committed to their work are the ideal
members of a team charged to identify service quality problems or patient care
improvements.
In the last section, we discussed the need of people to feel a sense of belong-
ing. A work team satises this need without any organizational intervention.
Most organizations, however, are unaware of the interrelationships between
individual goals, team goals, and organizational goals. That is, individual ef-
forts help the team reach its goals, which in turn enables the organization to
achieve its mission.
If the organization enables the team to satisfy its higher-level need (e.g., sense
of belonging), then the organization and its efforts will gain support from the team
and its members. Although this sounds easy to do, it is not. Most organizations
do not know how to tap into their connection with work teams and their many
benets, as discussed in the next section.
Building strong work teams is worth the effort. Exhibit 8.3 sums up the char-
acteristics of a well-functioning work team. A manager can use these guidelines to
strengthen a weak work team and improve its performance.
Benefits of Teams
An organization can reap many benets from supportive and productive work
teams:
202 Achieving Service Excellence
1. Access to the teams innovative ideas. Few healthcare managers know
everything or are capable of identifying the ideal answers to every
customer problem. Using team problem-solving processes generates
a wealth of new ideas and frequently a better perspective than the
manager alone might have. After all, those who deal with customers and
the problems serving customers may create know the details of those
problems better than do the managers, who typically have multiple
responsibilities.
2. Improved employee behavior and productivity. If the team has a
performance objective, the group is better equipped to monitor and
oversee each members contribution than managers are. The teams
approval of the members work will likely have greater weight for the
individual than the supervisors because the individual works more
closely with the team.
Exhibit 8.3 Successful Work Team Characteristics
The successful work team
1. Has a meaningful team purpose that inspires and focuses the members efforts
2. Has goals and objectives that are measurable, specic, realistic, easy to understand and with
dened areas of authority
3. Is small enough to act as a true team (515 members)
4. Has members with the necessary skills to operate as a team (functional/technical skills
appropriate for the decision area, problem-solving/decision-making skills, and interpersonal/
team skills)
5. Has clear, well-organized work procedures and rules of behavior that are enforced by the
team
6. Has a cultural value of mutual accountability, where only the team, not any one team
member, can fail or be a hero
7. Is supported by the organizations leadership and led by a team-building coach who builds a
performance culture
8. Has enough group time to allow members to interact and learn how to care about one
another
9. Understands the extent of its authority
10. Is provided with the resources necessary to succeed
Chapter 8: Motivation and Empowerment 203
3. Shared learning and decision making. When teams are brought in to
help with organizational efforts, shared learning occurs. Team members
learn more about the organization and its strategies. In turn, leadership
gains a better understanding of what it wants to do and how to do it.
Also, members learn more about the task or goal at hand, the reason
it must be done a certain way, the contributions of others toward its
accomplishment, and its relationship with the overall organizational
goal. Involving teams provides management a clearer picture of the
problem; after all, a manager who lacks insight about an issue cannot
explain it to anyone else nor determine the best resolution. Lastly, team
involvement enables employees to be more accountable for their own
work.
4. Ownership and responsibility. When a team is charged with a project,
its members take ownership and responsibility for every aspect of the
project, including analyzing the issue, communicating with stakeholders,
identifying solutions and implementing the best one, and monitoring the
outcomes.
For example, a work team is formed to resolve the problem of too
many dishes breaking during meal deliveries. The team discovers that the
plates break because the food trays are stacked without spacers in between.
When the service carts roll over tile oors, the trays rattle and then slide
off, spilling the plates to the ground. The teams solution is to place rubber
spacers between the trays.
Because the team came up with this idea without managerial input, the
members work harder to ensure it is viable. They push the service carts loaded
with trays with rubber spacers, wriggle the trays to ensure no slipping occurs,
talk with the kitchen staff to get their input and cooperation, and assess the
effectiveness of the intervention several weeks later. In the end, this solution is
noted a success.
Often, such problems are given to industrial engineers or outside
consultants, who come up with elegant but impractical solutions. This move
does not usually solve the problem and only frustrates employees.
By using a work team, managers enable those who do the actual work to par-
ticipate in making improvements. Also, it sends the message that employees are
trusted and their capabilities are valued. Possible results of this approach include
a boost in morale, a reduction in absenteeism, and enhanced recruitment and
retention. (See Sidebar A for another example of a work team in action.)
204 Achieving Service Excellence
Nursing Teams
Nursing care teams have emerged as a common approach to organization design
and acute care in U.S. hospitals (Dreachslin, Hunt, and Sprainer 1999). A typi-
cal nursing care team includes one registered nurse, who serves as the team leader,
and one or two nonlicensed caregivers, who help the nurse deliver care. Like other
team approaches, complementary skills and commitment to a common purpose
characterize a nursing care team. The difference between a nursing care team and
a traditional nursing team is that the boundaries of the latter are rigid whereas the
boundaries of a nursing care team are permeable. Nursing care team members are
able to perform duties as needed to serve the patient, unhampered (within legal
boundaries) by rigid role denitions. This design allows team members to experi-
ence more empowerment in terms of decision making in patient care.
Possible Problems with Teams
Potential problems with the team approach include the following:
Teams do not always work as fast as individuals do.
Teams require managers to take on a new mind-set and change behaviors
related to employee leadership.
Teams require investments of money and time.
Teams are limited to tackling one problem, situation, or task, all of which
must present opportunities for member participation.
Many of these disadvantages are discussed in the following section.
SIDEBAR A:
SELF-DIRECTED WORK TEAMS
Self-directed work teams drive the services at
Kansas Neurological Institute (KNI), a residen-
tial facility for people with developmental dis-
abilities. KNI has 24 self-directed teams, each of
which is composed of 814 support staff and is
led by a coach. Teams offer 24/7 support to resi-
dents and may call on KNIs clinical staff, includ-
ing therapists, at any time.
Teams provide a lot of services, including
assistance with personal care, meal prepara-
tion and shopping, and entertainment. In addi-
tion, team members are sensitive to residents
lifestyle preferences and consider those needs
when extending any kind of support. KNIs self-
directed teams advance KNIs mission. (See www
.srskansas.org/kni for more information.)
Chapter 8: Motivation and Empowerment 205
Team resolutions take more time than those reached by an experienced manager.
Most team members do not intuitively know how to make decisions systematically
or how to collaborate with others to build a consensus. Teaching members these
skills adds to the limited time afforded for problem solving. Also, explaining the
who, what, why, when, where, and how of an issue to a group of people with vary-
ing degrees of team skills and organizational experience takes time.
Team decisions cause confusion and fear among current managers and supervisors.
Most managers and supervisors were promoted because they were the best at doing
whatever job they now supervisethe best nurse becomes the head nurse, the best
x-ray technician becomes the department head, and so forth. If the organization
assigns a promoted manager to coach a decision-making team, the manager will
become confused and wonder why she was promoted at all if the organization did
not intend for her to make decisions. Simply, the message here is mixed, and many
managers have a difcult time shifting gears to be coaches instead of doers or deci-
sion makers. The other consequence for managers is fear. Managers may feel inse-
cure about their future role and responsibilities when their direct reports are now
able to do their job. If a managers job is to oversee all aspects of his department and
employees, what value does the manager offer if those employees are empowered to
manage themselves and make departmental decisions? Because of this threatened
feeling, many managers have found ways to discourage (or even sabotage) empow-
erment programs and team efforts.
Team decision making is neither cheap nor always effective. Taking employees out
of their normal routine to work on a special task or project has a cost. Furthermore,
teams are incapable of making decisions (or making them well) on matters that are
beyond the authority, concerns, interests, or expertise of their members. For ex-
ample, a team of pharmacists is not equipped to establish a sound corporate policy
for nurses. Even if the pharmacists receive extensive training on nursing issues, they
will still be unable to grasp the details and implications of their decisions.
Following are some additional problems with teams:
Decisions that require technical expertise beyond that typically available
to the involved team members will not likely be successful.
Employees who are not on a team may feel left out and become
resentful when teams are rewarded for good ideas and/or successful
implementation.
Some team members may become freeloaders and not contribute
their fair share to the team.
Not everyone can work successfully in a team format.
206 Achieving Service Excellence
When to Use Work Teams
An organization needs to determine the answers to four critical questions before it
uses team-based decision making:
1. Is management comfortable letting work teams make decisions about their job
responsibilities? Although this sounds easy to answer, it is not. Many managers
are uncomfortable letting go of their managerial prerogatives. Even so, they
often have to in healthcare because so many healthcare activities, such as
strategic planning, can only be accomplished by teams. No one person has the
time or skills to perform every task and make every decision.
2. Is management ready to let teams be accountable for their efforts and decisions?
Because most managers are evaluated on the basis of their units performance,
this is a hard question also. If the manager is accountable for the decision,
how can the manager be comfortable allowing the group to make a decision
that might come back to haunt the manager if it turns out poorly? If they have
to be accountable for the results, most people believe they might as well make
the decisions themselves, and they have a hard time trusting another person or
group to make the decisions for them.
3. Is management ready to share the benets of the decisions? This question leads to
others: If the group makes good decisions and saves the organization money,
will management share the rewards with the group? In a related way, will
management share the glory and other benets that result from high levels of
performance in an organization? If the team makes the decision that wins the
boss the big bonus and the trip to Hawaii, will they ever work that hard on
behalf of the organization (or that manager) again unless they too benet in a
meaningful way?
4. Is management ready to let team decision makers grow and develop? If the group
and its members do not get the opportunity to grow and develop, but see
management getting these opportunities as a result of the groups efforts,
they will lose their interest in and enthusiasm for the team decision-making
process. Management who wants team decision making to succeed must be
ready to let the team and its members participate in growth and development
opportunities and organizational rewards and must be willing to trust them
with the authority and responsibility for decision making.
Although work teams offer an important benet to employees by provid-
ing a sense of belonging, effective work teams do more for their members.
They provide a sense of self-worth, the opportunity to grow and develop, and
Chapter 8: Motivation and Empowerment 207
a means to recognize and share achievements and failures and to reinforce each
others values and beliefs. In brief, they help satisfy each group members need to
grow and develop as a person and as an employee.
For an organization to garner the benefts of teams, success in achieving cus-
tomer service goals needs to be celebrated in public. Not only do data need to be
shared but team success also needs to be recognized publicly because it reinforces
the culture of excellence. Public praise played a major part in the successful turn-
around of Baptist Health Care (see Sidebar B).
EMPOWERI NG EMPLOYEES
Teams need to grow and develop, but so do individuals. One great asset a team
provides to its members is the opportunity to grow within the group setting. But
the organization should provide additional opportunities for its members to satisfy
this important need. The most widely discussed strategy for doing so is empower-
ment. Becoming empowered may add to the fun and value of the job for employ-
ees. It may also add a sense of fairness because well-trained employees may think it
is only fair that they be given some responsibility for making decisions related to
their own work.
The main benet of empowerment is that a job that offers opportunity for
growth and development through empowerment is more interesting. The orga-
nization also benets from interested, empowered employees. An empowered
SIDEBAR B:
TURNAROUND AT BAPTIST HEALTH CARE
Baptist Health Care, a 456-bed, not-for-prot
pediatric teaching hospital, formed a patient
satisfaction committee to evaluate and moni-
tor its service performance (Stavins 2004). The
committee conducted telephone surveys for in-
patient, outpatient, emergency, and day-surgery
departments. These surveys enabled the team
to identify problems, reward outstanding ser-
vice, and initiate innovative and improvement
practices.
For example, when waits and delays were de-
termined to be a concern to patients, the staff
were asked to inform patients and families when-
ever there was a delay and how long the wait
would be. Later, the committees work branched
out to departments with little or no patient con-
tact. The purpose for this expansion was to im-
prove service between departments and among
all staff.
Formation of the committee created a unied,
organization-wide approach to customer satisfac-
tion. It emphasized the importance of customer
service, even among those who usually did not
provide direct customer care. It also brought out
and involved employees who have extensive yet
hidden/underused skills, such as knowledge of
survey tools and statistical processes and a pas-
sion for customer service.
208 Achieving Service Excellence
healthcare provider can personalize the healthcare experience to meet or exceed
each patients expectations and can take whatever steps are necessary to prevent
or recover from service failures. Organizational success or failure can hinge on the
quality of a healthcare experience.
Empowerment is the assignment of decision-making responsibility to an in-
dividual. It requires sharing information and organizational knowledge that will
enable the empowered employees to understand and contribute to organizational
performance, rewarding them based on the organizations performance, and giving
them the authority to make decisions that infuence organizational outcomes. Em-
powerment is broader than the traditional concepts of delegation, decentralization,
and participatory management. Empowerment can stretch decision responsibility
beyond a specic decision area to include decision responsibility for the entire job
and for knowing how the performance of that job ts within the organizational
purpose and mission.
Managers of some organizations talk the talk of employee decision input but
do not give employees any real power or authority to implement decisions. The
purpose of employee empowerment is not only to ensure that effective decisions
are made by the right employees but also to provide a mechanism by which respon-
sibility for job-related decisions is vested in individuals or in work teams. Empow-
erment also means management is willing to share relevant information about and
control over factors that impinge on effective job performance.
Empowerment is not an absolute; it has degrees. Managers may fnd that more
empowerment is not necessarily better. For example, a manager can choose to pro-
vide higher degrees of empowerment for some individuals and teams doing certain
tasks than for others. Indeed, even within a given persons job or a given groups
task responsibilities, different decision areas can be empowered to different de-
grees. A clinic, for example, may empower its nurses with complete authority to
regulate who may visit patients and when, within a certain range of variation, to
meet the level of patient satisfaction offered by competing clinics. However, the
clinic might not be willing to let the same nurses make minor modications in
clinical protocols or hours of clinic operation.
The Job Content/Context Grid
Healthcare managers may need help in seeing how to use the empowerment con-
cept in their own organizations. They may also need help with managing the deli-
cate balance between giving employees control over their own work processes while
retaining some supervisory control over what employees do. What would happen,
Chapter 8: Motivation and Empowerment 209
for example, if management empowered a work group by assigning the group au-
thority and responsibility over a job and the group decided to do nothing at all
related to the organizations goals? Obviously, empowerment must occur within
some limits, and where to place them becomes a major challenge in implementing
any empowerment strategy.
An organization wanting to empower its employees must rst analyze its jobs.
All jobs have two dimensions: content and context. Job content represents the tasks
and procedures necessary for doing a job. Job context refers to why the organiza-
tion needs a job done; how one job interacts with related jobs; and how a job fts
into the overall organizational mission, goals, objectives, and job setting. Managers
trying to use empowerment will nd it helpful to view decision making not simply
as an act of making a choice among alternatives but as a ve-stage process:
1. Identify the problem,
2. Discover alternative solutions,
3. Evaluate the pros and cons of those alternatives,
4. Make the choice, and
5. Implement and follow up on the effects of that choice.
Employees can be empowered to participate in one, some, or all of these stages.
Exhibit 8.4 shows a grid with the job context on the vertical axis and the job
content on the horizontal. The horizontal axis shows the way in which the em-
ployees or teams decision-making responsibility over job content progressively in-
creases in relationship to the decision-making process. For example, at the far left
of Exhibit 8.4, in the frst step of the decision-making process, employees have little
responsibility; but the level of responsibility and the decision involvement increase
as one moves to the right. Similarly, as one moves up the vertical axis, responsibility
and involvement over decisions related to job context increase. A manager seeking
to empower employees may wish to increase decision responsibility over job con-
tent, job context, or both. The fve points (points A through E) identifed on the
grid allow a better understanding of varying strategies for empowerment available
to managers.
Point B (Task Setting) is the essence of many empowerment programs used
today. Here, the worker is given a great deal of decision responsibility for the job
content and little for the context. The worker is empowered to make decisions
about the best way to get an assigned task accomplished. In these cases, manage-
ment denes the mission and goals, and the worker is empowered to nd the best
way to reach them. Management hopes the empowered workers will apply their job
knowledge and intellect to discover ways to improve what they do in their jobs.
210 Achieving Service Excellence
Many healthcare jobs are in this category. Patient-service employees, for ex-
ample, must do the job as dened by the clinical protocol but have exibility to
do it in a variety of ways to meet the needs and expectations of varied patients.
An admissions representative may be given the decision responsibility to prioritize
patient treatments based on some triage protocol, for example. Hospital nurses also
follow strict clinical protocols but have a certain degree of exibility in how they
deliver care.
For example, a nurse on the maternity ward may give an educated, married
mother of four a copy of the postoperative instructions as clinically ordered but
may choose to spend more time explaining instructions to an unmarried teenager
having her rst child. Nurses must make care decisions based on their judgments
about the needs of each individual. A 90-year-old man with a broken leg requires
different care from an 18-year-old football player with the same condition.
Point B represents a signifcant departure from Point A (No Discretion) because
employees are totally involved in making decisions about job content. Jobs at Point
Exhibit 8.4 The Employee Empowerment Grid
decision responsibility for the job content and little for the context.
The worker is empowered to make decisions about the best way to get
the assigned task accomplished. In these cases, management defines
the mission and goals, and the worker is empowered to find the best
way to reach them. Management hopes that the empowered workers
will apply their job knowledge and intellect to discover ways to improve
what they do in their jobs.
Many healthcare jobs are in this category. The patient-service
employee must do the job as defined by the clinical protocol but has
flexibility to do it in a variety of ways to meet the needs and expecta-
tions of varied patients. The admissions person may be given the deci-
sion responsibility to prioritize patient treatments based on some triage
protocol. Hospital nurses follow strict protocols but have a certain
:i achi evi ng s ervi ce excel l ence
Figure 8.2 The Employee Empowerment Grid
D
e
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i
s
i
o
n
-
M
a
k
i
n
g

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e
s
p
o
n
s
i
b
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i
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y

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J
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C
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i
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Decision-Making Responsibility for Job Content
Increasing
Implemen-
tation/
Follow-up
Alternative
Choice
Alternative
Evaluation
Alternative
Development
Problem
Identification
Point D
Mission
Defining
Point A
No
Discretion
Point E
Self-
Management
Point B
Task
Setting
Point C
Participatory
Empowerment
Problem
Identification
Alternative
Development
Alternative
Evaluation
Alternative
Choice
Implemen-
tation/
Follow-up
Source: Reprinted with permission from Academy of Management Executive 9 (3):
24, 1995. Empowerment: A Matter of Degree, by R. C. Ford and M. D. Fottler.
Fotter/book 8/12/02 3:47 PM Page 214
Chapter 8: Motivation and Empowerment 211
B can be redesigned by employees or even teams of employees. They may redesign
their tasks to add more content or develop a variety of new employee skills. Many
Point B employees nd such enriched jobs more motivating and satisfying, leading
them to do higher-quality work. Even when management confnes empowerment
to job-content decisions, employee motivation may be enhanced for those who
strongly value feelings of accomplishment and growth. The success of the Point B
strategy, however, will partly depend on factors beyond employee control, such as
the design of the service delivery system, organizational structure, patient expecta-
tions, clinical protocols, reward systems, and support of top management.
Point B and the Healthcare Industry
Point B empowerment perfectly suits many healthcare organizations and many
healthcare employees. The clinical requirements dene the job, and employees
are expected to meet those requirements to achieve the desired clinical outcome.
Some organizations expect employees to do the job strictly by the numbers, but
benchmark organizations empower employees to provide service in a variety of
ways. For example, even if a nurse in a burn ward has 25 patients who need their
dressings changed every six hours in the same way, the manner in which that care
is given and the interaction patterns that take place with each patient make each
occasion somewhat different and potentially interesting for the nurse. Each oc-
casion also presents an opportunity to perform a routine task with personalized
care and attention.
Benchmark healthcare organizations know patient satisfaction increases when
employees are empowered to decide if they need to spend more time with patients
and are able to go the extra mile to make them feel comfortable. Allowing staff
to exceed patient expectations is particularly important when patients have com-
plaints. Benchmark organizations empower all employees to provide token restitu-
tion (up to a certain dollar amount) when a patient believes some type of service
failure has occurred.
For example, at Baptist Health Care, each employee can go to the hospital gift
shop and spend up to $300 to replace a patients lost belonging or buy owers to
appease a complaining patient. Studer (2008, 15556) gives an example of a hos-
pital cashier in a cafeteria who notices that some patients who are admitted have no
family to help them. She realizes they will probably have to leave an inpatient stay
with the same clothes they arrived in. For such patients, the cashier will offer to
take their clothes home to launder and will return with clean clothes the next day.
Studer describes this person as an owner because she attends to her customers,
212 Achieving Service Excellence
thinks innovatively, makes personal sacrices, and goes beyond her job description
to keep customers happy. Studer suggests that all managers should identify such
employees, hold them up as an example to others, and do everything possible to
empower them to serve customers.
All in all, a Point B empowerment level is the most suitable for many patient-
contact jobs in the healthcare industry. This level gives healthcare providers the
exibility to meet and exceed the patients expectations and to prevent and recover
from any service failures while maintaining the proper clinical protocols.
Implementation
Successful implementation of an empowerment program requires knowledge of
the available strategies and the determinants of their successful application and
an awareness of the situations and people who can benet from empowerment.
Implementation of empowerment should begin by focusing on decisions related
to job content and then moving gradually through the various decision-making
stages from problem identication through implementation to follow-up. Later,
after employees and managers become comfortable with empowerment in job con-
tent, increasing levels of empowerment in job context can be added by raising the
level of decision-making authority from problem identication up through imple-
mentation and follow-up.
At each step, management can determine what diffculties were created; how
they should be addressed; and whether or not the individuals or teams were ready,
willing, able, and trained to move on to the next stage of decision involvement
and responsibility. Alternatively, a company might empower employees to iden-
tify problems and develop alternatives simultaneously for job content and job
context.
For either of these approaches or any other mid-range strategies, management
needs to determine frst where it would like to be on the grid in Exhibit 8.4 and
then develop a plan to move its employees gradually toward that point. The grid
simply illustrates the stages of employee empowerment, which allow managers to
decide what level of empowerment their organization is ready for and what can
be done to implement that desired degree of involvement in making job-related
decisions.
Following are fve key ingredients to any successful empowerment program:
1. Training in knowledge areas, patient service, and decision making; if
empowering a group (see the work team discussion), training in group
interaction
Chapter 8: Motivation and Empowerment 213
2. Measurable goals or standards, so empowered employees and their managers
have a means to test whether their decisions are good or bad
3. Methods of measuring progress toward goals, so empowered employees and
their managers can tell if what they are doing is heading toward the job goal
or away from it
4. An incentive system to reward the employees for making good decisions and
to make it worth their while, both nancially and in terms of other eager
factors, to take on decision responsibility
5. Willingness of employees to make decisions and willingness of managers to
take those decisions seriously
Limitations and Potentials
Of course, employee empowerment has some organizational limitations. Employee
empowerment may be less appropriate under the following conditions (Bowen and
Lawler 1992):
1. The basic business strategy emphasizes low-cost, high-volume operations.
2. The relationship with customers tends to be short term.
3. The technology is simple and routine.
4. The business environment is highly predictable.
5. Employees have low growth needs, low social needs, and weak interpersonal
skills.
Alternatively, employee empowerment can be highly rewarding under the fol-
lowing circumstances (Bowen and Lawler 1992):
1. Service is customized or personalized.
2. Customer relationships are long term (this is sometimes but not always true in
healthcare).
3. The technology is complex.
4. The environment is unpredictable.
5. Employees have high growth needs, high social needs, and strong
interpersonal skills.
Regarding item 5, employee empowerment alleviates the uneasiness and awk-
wardness staff feel during many patient-contact situations, especially when those
situations are negative. Within all organizations, including healthcare organiza-
tions, some departments, employees, or jobs may be better suited for employee
214 Achieving Service Excellence
empowerment than others. Managers hoping to gain the benefts of empower-
ment can initially implement a limited form of empowerment in areas where the
match appears potentially fruitful. From here, problems can be worked out and the
empowerment process gradually expanded. Indeed, those healthcare organizations
engaged in total quality management efforts, organizational reengineering, or at-
tempts to reenergize their corporate cultures commitment to service through the
introduction of more participatory management styles may nd the incremental
strategy useful.
Because the workforce is so diverse, some employees will be better suited for
empowerment than others. Part-time employees or contract (temporary) employ-
ees may not be interested enough in the goals of the organization or their long-term
relationship with the organization to be good candidates for empowerment pro-
grams. For example, doctors sometimes build strong relationships with patients.
These relationships motivate patients to come back again and again; seeing familiar
physicians adds value to their healthcare experience. A major problem with health
maintenance organizations (HMOs) is that their managers seem unable to use
appropriate motivation and empowerment techniques to keep physicians on their
panel. This physician turnover is one reason for widespread customer dissatisfac-
tion with HMOs. HMOs need to empower physicians to practice in the patients
best interest rather than question and penalize their clinical decisions.
The art of good management is in determining which employees should be
empowered to do which task or to make which decision. Admittedly, this is a
daunting challenge, especially if the wrong call on the managers part leads to a de-
cision that presents a disadvantage to a large number of people. For example, if an
empowered employee allows patients to check out two hours late, the housekeep-
ing staff may have difculty preparing the room for the next patient, especially if
another empowered employee allows the next patient to check in early. Empower-
ing one employee must not be allowed to negatively affect how other employees
perform their jobs.
Ultimately, a successful healthcare manager knows the vital importance of mo-
tivation and empowerment if the organization is going to retain the employees it
worked so hard to recruit and train.
CONCLUSI ON
All employees seek certain types and amounts of inducements from their organiza-
tions; that is why they joined. A manager who is able to provide those inducements
can elicit effort, productivity, enthusiasm, and other contributions the healthcare
Chapter 8: Motivation and Empowerment 215
organization seeks from all employees. Determining the mix of rewards or motiva-
tors most important to employees or a group of employees is a critical managerial
responsibility. These factors enable employees to view their jobs as fun, fair, inter-
esting, and important.
Service Strategies
1. Set clear, measurable standards that defne expectations for job
performance in all areas, including customer service. Constantly reinforce
these standards by setting examples. Let employees know the standards are
important, and reward employees when they meet them.
2. Walk the talk. Set the example. Employees respond more to what is done
than to what is said.
3. Make all tasks and goals measurable; people like to know how well they are
doing.
4. Pay attention to communication; people cannot do what they do not know
about or do not understand.
5. Be fair, ethical, and equitable. People need to believe they are being treated
fairly. If you do not show people why distinctions are made between
employees, they will assume the worst.
6. Focus on frequent, ongoing feedback geared toward improved job
performance (i.e., coaching).
7. Reward desired behaviors. Among the most important rewards are public
celebrations of individual and team success in serving customers.
8. Identify and provide the types of rewards most desired by various
subgroups of employees.
9. Praise, praise, praise. Give public reinforcement to employees who are
doing the right things. Re-educate and coach, in private, those who are
doing the wrong things.
10. Show employees the relationships among their personal goals, group goals,
and organizational goals. Find winwinwin situations.
11. Support and trust frontline employees.
12. Give people a chance to grow and get better, and then reward them for it.
13. Make employees jobs fun, fair, interesting, and important to the extent
possible.
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217
God helps those who help themselves.
C. Simmons
C H A P T E R 9
Involving the Patient and Family in Coproduction
Service Principle:
Empower patients and their families to help meet their own
healthcare needs
Patients and their friends and families may participate in coproducing almost
any healthcare experience. This involvement can take many forms, no matter how
seemingly minor. For example, patients are encouraged to walk after surgery to
facilitate their recovery, are required to bring their own test results to a follow-
up visit, and are put in charge of regulating their own medications. In addition,
friends and family members are increasingly called upon to assist the patient at
home or at the hospital.
Assigning specic tasks to patients and their informal caregivers (e.g., family,
friends) is part of a broader trend to actively engage consumers in their own health-
care. To this end, healthcare providers and their staff must spend time and effort
investigating where and how patients can participate. Successful coproduction of
a healthcare experience relies on the effective coordination of care processes, a re-
sponsibility of management and staff.
Prahalad and Ramaswamy (2004a) advise consumers and organizations to think
of themselves as joint creators of value. They can do this by creating personalized
healthcare experiences that take into account the uniqueness of individual patients.
Organizations that allow everyone to participate in this process will encourage
communication-rich transactions and open dialogues.
Prahalad and Ramaswamy (2004b) note that the role of consumers has
changed. They are now connected, rather than isolated; informed, rather than
unaware; and active, rather than passive. These changes are manifest in patients
218 Achieving Service Excellence
readiness to access information, participate in networking activities, and experi-
ment with care modalities.
In this chapter, we address the following:
The reason healthcare organizations should promote the involvement of
patients and their families in coproducing service experiences
Ways to facilitate consumer involvement
The advantages and disadvantages of coproduction from all perspectives
PATI ENTS AS QUASI - EMPLOYEES
Traditionally, employees think of their job as the producers of a consistently aw-
less healthcare experience while coping with the anxieties of patients and their
loved ones. In this view, employees do things to patients.
Managers, in turn, help employees handle patient confusion and uncertainty
by providing training in customer relations techniques. A more effective strategy is
to treat patients and their families as quasi-employees (Ford and Heaton 2001). In
this view, employees do things with customers.
To enable a successful quasi-employee approach, the organization must design
the service product, environment, and delivery systems in a way that takes advan-
tage of the knowledge, skills, and abilities (KSAs) of patients and their friends and
family. The organization must gure out how to enable quasi-employees to partici-
pate in their care. (Although the quasi-employee role may be played by the patient,
a family member, a friend, or all three, for the sake of simplicity, the role will refer
to the patient in this chapter.)
Managing quasi-employees follows a four-step strategy:
1. Carefully and completely dene the role. In effect, do a job analysis: Defne the
KSAs required to perform the jobs identied as desirable and appropriate for
the patient. Make sure the patient is physically able, mentally prepared, and
sufciently skilled for the tasks.
2. Communicate and clarify the role. The quasi-employee should be clear on the
roles expectations. Set goals, and show the patient the benets of the role.
This will give him a reason to do the tasks well.
3. Evaluate the quasi-employees ability and performance. In effect, conduct a
performance appraisal on the patient to ensure that the experience being
coproduced is meeting expectations. If it is not, identify what needs xing
Chapter 9: Involving the Patient and Family in Coproduction 219
and fx it. Does the patient need further training? Is the environment or
delivery system impeding the patients ability to successfully perform the
assigned tasks?
4. Provide resources and support for coproduction and follow-up care in the form
of care coordinators.
Of course, no one should be allowed to coproduce the experience if learning
the necessary skills is too dangerous, time consuming, or difcult. By carefully
assessing the care processes of a healthcare experience, the manager or provider
can identify those aspects where patient participation should be discouraged,
encouraged, optional, or required. For example, a physician may require a pa-
tient to take her blood pressure at home or to walk to the cafeteria for meals,
instead of waiting for the food to be delivered to her hospital room. These as-
pects of the healthcare experience are within the patients capabilities and can
aid their healing.
Ordering patients to resume physical activity during hospitalization or after
surgical procedures has become common. In the past, patients were expected to
stay in bed after an appendectomy, for instance, but today they are encouraged
to get up and walk, a move that promotes healing. Today, the linkage between
physical activity and postsurgical healing is so well accepted that patients have to
participate to get better.
Again, not all aspects of the healthcare experience call for patient involve-
ment. Sometimes it may even be harmful. The challenge for managers and pro-
viders is in distinguishing between when participation makes sense and when
it does not.
Beverly Johnson, president of the Institute for Family-Centered Care (see www
.familycenteredcare.org), provides a succinct call to action: If we could make
only one change in healthcare it should be to change the notion that fami-
lies are visitors. Families are allies and partners for safety and quality (Beck
2008).
STRATEGI ES FOR I NVOLVI NG PATI ENTS
Patients can get involved in their care in several ways: as consultants or sources of
expert information, as part of the environment for other patients, as coproducers
of the experience, or as managers of the service providers and systems. Some of
these coproduction roles may sound unlikely, but they are all common.
220 Achieving Service Excellence
As Consultants
One of the best ways for healthcare organizations to enhance their performance in
customer service and customer satisfaction is to bring customers into the decision-
making loop by allowing their input on devising new services and improving exist-
ing services. Today, erce competition has forced most organizations to become
more exible and creative in their dealings with customers to give them exactly
what they want (Berry and Seltman 2008).
For example, in 2008, GE won the prestigious NorthFace ScoreBoard Award
for the seventh year in a row. This award recognizes GEs excellence in customer
satisfaction and loyalty. In receiving the award, Mike Battuello, general manager
for GE Healthcares Life Systems Services, said,
Our organization is devoted to understanding and improving the customer
experience at every interaction. You will never see us rest on our laurels.
For example, after receiving last years NorthFace Award, we launched an
initiative called the Raving Fans program, in which our feld personnel had
business review meetings with many of our customers beyond the time
of service. It is a great opportunity to have a dialogue, listen to customer
input and learn about the initiatives at their hospitals to make us an even
better partner. Winning this award is a reection on the teams ability to
turn customer input into customer delighters. (Cram 2008)
When an organization asks its patients what they liked or disliked about their
healthcare experience, the patients become unpaid consultants (Kotler 2004). Be-
cause patients have gone through the experience, they are experts and good sources
of information related to the service, environment, and delivery system. Using cus-
tomers as consultants is not unique to healthcare businesses; in other industries, past
and present consumers are invited to provide systematic feedback and review about
their product and service. Customers are also asked to participate in focus groups.
Today, benchmark companies give customers the tools to design/redesign prod-
ucts and to serve as collaborators (Heckscher and Adler 2006). Pitt County Memo-
rial Hospital in North Carolina gives family and patient advisory groups a voice
in designing new facilities and in interviewing physicians who apply to practice at
its hospitals. Initially, some staffers worried that this process would take up valu-
able time, but it saves time in the long run because doctors and nurses have more
information to work with (Beck 2008).
One way the patient-as-a-consultant idea can apply to healthcare is to invite
patients and families to speak with a team of administrators, physicians, nurses,
Chapter 9: Involving the Patient and Family in Coproduction 221
and other staff after a service encounter. Also, customer input may be collected
through a 24-hour hotline, comment cards, telephone interviews, and the organi-
zations website.
In many healthcare organizations, no real collaboration exists between patients
and providers. Collaboration requires mutual contribution, but in healthcare the
patient does not feel like an equal partner because she relies on other people and
probably lacks clinical knowledge. Caregivers are more dominant in the traditional
system of care. To change that system, providers have to see it from the patients
point of view and redene it on the basis of patient concerns.
Focus Group
A focus group is one method for learning the patients point of view and concerns.
For example, the orthopedic unit of a major hospital in Florida conducted focus
group sessions to identify areas of improvement. The unit learned that patients
were troubled that they could not le a complaint about the same people on
whom their care depended. Patients wanted to complain about the night nurses
who disregarded their requests for help or left them unattended for lengthy pe-
riods. Patients were afraid that their complaints would lead to retaliation. As a
response to this nding, the units management created a new channel of com-
munication that gives patients direct access to someone who can intervene on
their behalf (Fottler et al. 2006).
Another nding from the focus groups was that patients did not appreciate
being uninformed while awaiting treatment; this uncertainty only created more
anxiety. This and other ndings led to improvements in various areas such as pa-
tient involvement, provider punctuality, complaint process, patient access to infor-
mation, and patientprovider communication. A focus group serves as an excellent
way to create a successful partnership between patients and healthcare providers.
As Part of the Environment
Each patient invariably infuences the healthcare environment, whether positively
or negatively. Research has shown that, when in a group, patients endure pain
better and display a more positive attitude. The same observation may be true for
negative experiences, illustrating the saying misery loves company.
There is an appropriate and inappropriate time for making the patient part of
the environment. Because of the intimate nature of many healthcare experiences,
privacy is a must. For example, when one patient is undergoing a physical exam,
no one else beside the physician and the patient should be present in the room,
222 Achieving Service Excellence
regardless of how much support and encouragement another patient could offer
the patient.
As Coproducers of the Experience
As discussed, a patients coproduction of a healthcare experience can take many
forms, including something as simple as pouring his own water to something as
complex as monitoring his own glucose level or heart rate and reporting the results
to the physicians using Web-based software. For about a decade now, many pro-
viders have been enabling their patients to participate in their care by giving them
information that can be used to make decisions on treatment options, medications,
providers, diets, and so on (Friedewald 2000). Such information may be accessed
through organizational websites, audiotapes and videotapes, guidebooks, and 24-
hour hotlines. Even more information is available on the Internet. A Google search
or a visit to WebMD will yield an amazing number of links.
How can hospitals ensure that patients continue to coproduce care beyond the
institutions doors? Lets consider the issue of readmissions. According to Landro
(2007b), U.S. hospitals see about 5 million readmissions a year, and approximately
one-third of these occur within 90 days of discharge. Instituting transitional pro-
grams can prevent as many as 46 percent of these readmissions (Landro 2007b).
Identifying patients at risk for return, scheduling follow-up doctors appointments,
and sending nurses to patients homes are also good strategies for reducing read-
mission rates. Educating patients and their families on self-care should be added to
these reduction strategies. Patients can be given practical tips on how to adhere to
medication schedules and how to monitor their symptoms at home.
Another area in which coproduction is benecial is palliative care. The fast-
growing eld of palliative medicine is gaining respect from doctors and appre-
ciation from patients. The number of medical centers offering palliative care has
doubled since 2000, growing to 1,240 programs in about 30 percent of hospitals
(Szabo 2007).
Because palliative medicine relies on a team approach, involving doctors, nurses,
psychologists, social workers, dietitians, and physical therapists, it is only natural
that it involves the patients and their friends and family, who play the role of in-
formal caregivers. In many cases, family members of cancer patients without a care
coordinator end up serving as the patients administrative assistants, chasing down
lab results, keeping track of prescriptions, facilitating communication among pro-
viders, and managing other care-related tasks. People in this role should be taught
the proper way to assist and care for the patients.
Chapter 9: Involving the Patient and Family in Coproduction 223
As Managers
Patients can take on the role of a quasi-manager, acting as the unofcial supervisors
and motivators of employees. They may also educate other patients by discussing
treatment options that have worked or not worked for them personally or any
other service-related problems and resolutions.
Patients who have had a long or repeated history with a unit or a clinic are
ideal as managers because they are familiar with the operations, staff, providers,
and procedures. They have had a chance to observe employee behaviors through
direct contact or conversation, perhaps more than the supervisor has. As a result,
such patients can provide good ideas and motivation to employees. The more
familiar patients are with the organization, the more they know about the cur-
rent level of service and the more qualied they are to provide improvement
recommendations.
Seasoned patients are not the only ones who can act as managers, however.
When an unhappy new patient tells an employee that he is not providing the ser-
vice properly, the patient is in effect performing a supervisory functiongiving
immediate feedback. The typical patient feedback to a caregiver consists of gri-
maces, smiles, screams, or some other nonverbal response. These responses are far
more effective guides about the quality of the experience than any instructions
a supervisor can give to the employee. Supervisors monitor staff s behavior as
they perform their clinical duties. They should also observe the patients reactions
to gauge satisfaction or dissatisfaction with the service. Facial contortions, verbal
directions, and direct complaints are denitive cues from patients to staff and
managers.
Patients can also be motivators. Most healthcare employees fnd great satisfac-
tion in meeting and exceeding the expectations of their patients. Employees usu-
ally enjoy the opportunity to be challenged by a patient who shares an interest or
expertise in the subject of the experience, just as college professors often nd the
students who ask the most difcult questions are the most fun to have in the class-
room. Most employees are constantly tested by the variety of patient expectations
and the variety of responsibilities in the service delivery process.
Patients can also supervise each other. For example, caregivers try to help pa-
tients cope with a terminal illness, but it is an enormous challenge that patients
may think the staff, whose lives are not at risk, are not equipped for. After all,
those who have not faced such an illness cannot possibly understand the degree
of emotional and physical pain that these patients must endure. As managers, pa-
tients who have or have survived similar diagnoses and treatment options can get
together with other patients to talk about their experiences.
224 Achieving Service Excellence
Most patients, like most employees, are anxious to fulfll their responsibilities
and do whatever is needed to relieve their suffering. These patients often watch
others to learn how to help themselves. For example, many pregnant women go
to birthing classes to learn breathing techniques that can minimize pain during
childbirth. Similarly, many amputees and breast cancer patients and survivors
attend group gatherings to gain insight from each other. Also, videos of expe-
rienced/former patients can be shown to inform or train current patients on
various subjects.
Savings in cost and time of patient participation can be substantial. Often, no
one is better able to help patients than the patients themselves.
ADVANTAGES AND DI SADVANTAGES OF
COPRODUCTI ON
Coproduction of the healthcare experience presents advantages and disadvantages,
each of which is explored in this section.
Advantages for the Organization
First, coproduction can reduce employee costs. Every time patients serve them-
selves, they are replacing personnel the organization would otherwise have to pay
to do the same thing. The more the patients can do for themselves, the fewer em-
ployees that need to be hired.
Second, coproduction enables the organization to better use the talents of its
employees. For example, at some hospitals, families are allowed to lead exercise
routines for their hospitalized relative. If patients (or loved ones) are allowed, en-
couraged, or forced to take care of some of their own basic needs, employees are
freed up to attend to more complicated services or deal with life-threatening situ-
ations.
In 2007, Emory University Hospital began inviting family members to move
into the ward to assist in caregiving for their respective relative (Landro 2007c).
Emory is among the frst U.S. hospitals to meld an intensive care unit (ICU) with
family living quarters, testing the healthcare grounds for coproduction. A wave of
recent studies shows that critically ill patients may benet from having family pres-
ent. A case may also be made for having loved ones present for resuscitation, brain
catheter insertions, and other life and death procedures.
Chapter 9: Involving the Patient and Family in Coproduction 225
In early 2009, the Society of Critical Care Medicine, the largest international
society representing intensive care professionals, recommended that ICUs open
visiting hours and increase family involvement. This recommendation comes as
hospitals nationwide are set to spend $200 billion over the next decade to upgrade
aging facilities. This massive investment should include physical structures that
provide better accommodations to families and friends who coproduce the care.
Providing space for these quasi-employees may increase their participation, which
may reduce length of stay, costs, and caregiver liability from errors. (See Sidebar A
for an illustration of this point.)
Advantages for the Patient
First, coproduction can lessen patient disappointment in the healthcare experience
while increasing the perception, and perhaps the reality, of service quality. Because
patients dene an experiences value and quality, their involvement could mean
that they are more satisfed with the outcomes they helped produce. For example,
if a patient adjusts his medication schedule according to his bodys reaction to the
drug, he is likely to comply with his own changes and to think that the drug works
better at a given time.
Second, coproduction can reduce the time required for service. A simple exam-
ple is using home-testing kits instead of visiting a doctor. A patients participation
in her own care often means she is using the most convenient and easiest method.
As a result, she will not likely travel any distance if she could complete her share
of the healthcare tasks in the safety of her home and with assistance from a family
member or friend. In this way, the doctors and staff s time is saved for patients
who need immediate attention.
SIDEBAR A:
FAMILY SPACES
In 2003, MCG Health System in Augusta, Geor-
gia, transformed the shared patient rooms in its
neuroscience ICUs into private rooms with fam-
ily living areas. As a result, the average length of
time a patient spent in the unit fell by 50 percent.
One year after the unit opened, medication er-
rors dropped to six, from an annual average of
13 in the two previous years. In addition, patient
satisfaction rose and nursing turnover dropped
(Landro 2007c).
The mounting evidence was enough to sway
the Institute for Healthcare Improvement (IHI).
In a 2004 editorial published by the American
Medical Association, IHI head Donald Berwick
and Meera Kotagal (2004) called on hospitals to
open ICUs to unrestricted family visitation.
226 Achieving Service Excellence
Third, coproduction minimizes unpleasant surprises for patients. If nursing
home residents are allowed to eat in the cafeteria instead of being expected to eat
whatever is delivered on the tray, they are given a choice. This choice reduces the
likelihood that the residents will complain about the food or the delivery time.
In ICUs, family members who witnessed resuscitations or emergency invasive
procedures on their loved ones reported it helpful to be in the room, instead of
waiting outside and not knowing anything. The experience allowed them to see
what doctors had to do to save the patients life (Landro 2007c).
Disadvantages for the Organization
First, coproduction exposes the organization to legal risk, especially in this litigious
society. A patient walking, instead of being wheeled, into the x-ray room can lead
to a lawsuit if the patient falls and sustains an injury.
Second, coproduction requires more training (and hence more expenditure)
for employees, who will need to know how to give directions to patients or fam-
ily members so they can participate in the care process. These careful instructions
must be given so that patients do not cause harm or damage to themselves.
The organization has to understand that every patient has different needs,
wants, and expectations and varying degrees of KSAs. Employees must be alert to
these patient differences so that they can properly coach each patient, not use blan-
ket instructions. When hiring laboratory workers, for example, an organization
could look for qualities that may, down the road, help the worker teach a patient
how to read his own test results.
Third, coproduction requires the organization to ensure that the delivery system
is user-friendly, which costs money. If the organization wants the patient to follow
a predetermined sequence of steps to create the desired experience, it must assign
employees to guide patients and ensure that excellent directions are in place or the
sequence is intuitively obvious to people from varied cultures and backgrounds.
Only then can the organization be reasonably sure that all types of patients will do
what they are supposed to do when/where they are supposed to do it.
For example, signs and directions must clearly point out where the entrance or
exit is, how to reach a particular unit or room, what times the unit/room operates,
what payment methods are accepted, and so on. These details may be well known
to staff and current patients, but they would be unfamiliar to a newcomer. Staff
must be alert for confused-looking or wandering patients if the signs and direc-
tions are unclear or not helpful. Today, more patients are directed to organizational
websites to conduct self-service transactions, such as scheduling an appointment.
Chapter 9: Involving the Patient and Family in Coproduction 227
Organizations must keep websites user-friendly as well to lessen patient frustration
and promote the use of the self-service technology.
Fourth, coproduction may require the organization to make back-of-the-house
areas look as presentable as front-of-the-house areas. Making the back of the house
a part of the healthcare experience has an obvious impact on how the equipment is
laid out; how shiny it is kept; and how the staff dress, behave, and interact during
service production.
In lab testing, for example, coproduction may mean that lab technicians, who
typically do not interact directly with patients, will need to hone their communi-
cation and interpersonal skills and take note of their general appearance and the
orderliness of the laboratory. The costs of the uniforms, the extra training in inter-
personal skills for back-area employees, and the rearrangement and upkeep of the
back area can all add up.
Fifth, coproduction may cause conficts from patients who are unwilling to dis-
engage from their role. Some patients enjoy coproduction so much that they refuse
to move on when necessary. An organization that accommodates this refusal ends
up needing to add extra capacity.
Clearly, when patients become coproducers, the traditional role of the provider
is redened. The provider needs extra training in assessing the coproducers KSAs
and coaching this quasi-employee so that she is capable of performing her tasks. If
the patient insists on playing a role for which she lacks the capability, she will in-
variably introduce a conict and may force the organization to spend more money,
which is not ideal in tough economic times.
Sixth, coproduction can be risky. For example, if a patient or family member
is injured during coproduction, the person may sue. Good organizations make
every effort to ensure that patients succeed as coproducers, but the risk of failure
is always present. If the costs of failure are too high, the organization must tact-
fully intervene to stop the coproduction. The organization must be astute enough
to recognize when coproduction will not be successful, such as when the patient
does not possess the right KSAs to monitor his own vital signs or to comply with
physician orders. In this case, the organization or provider must take over before a
negative event occurs, and must do so with grace so as to not embarrass the patient
or anyone else involved.
Disadvantages for the Patient
First, paying patients may resent having to produce any part of the service for
which they are being charged. Some task-oriented patients do not particularly want
228 Achieving Service Excellence
much service provider interaction; they just want a health service. A production-
line approach suits them just ne. Other patients, on the other hand, insist on
and require close personal attention. If shifting part of the healthcare experience
to patients themselves results in less TLC (tender loving care), those patients will
be dissatised.
Second, patients may fail to coproduce the service or any associated product
properly. If patients nd the physical therapy routine they engage in boring, they
will quit and view the experience as unsatisfactory; worse, they will not have a
provider or staff member to blame for this failure. Healthcare organizations try to
protect patients against self-service failures, so they let patients try again or they
offer help. Nonetheless, the risk of a negative outcome is ever present.
Patients should participate when they have the necessary KSAs, and are mo-
tivated to do so if they know that the outcome is benecial or the service itself
cannot happen without their involvement, such as in the case of losing weight,
stopping smoking, lowering cholesterol, or even saying Ah during a throat exami-
nation or pushing during childbirth. In addition, many medical conditions are rst
diagnosed when the patient clearly describes the symptoms.
Many patients are motivated to participate because of their personalities, their
familiarity with the experience being offered, boredom, or a desire to get well. By
contrast, those who are not motivated to get well or even to survive will not want
to participate in their own healthcare. Some patients simply want to be a part of
whatever they are involved in at the moment, no matter what, and constantly look
for such opportunities. Some people always park their own cars, carry their own
luggage, or walk up the stairs because they like to demonstrate for themselves (and
anyone else who cares to watch) that they are physically t enough to do these
things. Others do things, such as complex medical research using the Internet, to
showcase their mental tness or technical adeptness.
A Perspective on Coproduction
A cynical view of coproduction (or self-service) in our society is reected in this
quote from nationally syndicated columnist Ellen Goodman (2008):
The outsourcing of work to other countries had produced endless ire.
But what about the outsourcing of work to me and thee? For every
task shipped abroad by a corporation, isnt there another one sloughed
off to that domestic loser, the consumer. For every job thats going to
a low-wage economy, isnt there another going into our very own low-
wage economy? In this self-service economy, we also serve (ourselves)
Chapter 9: Involving the Patient and Family in Coproduction 229
by having intimate and endless conversations with voice recognition
machines, simply to rell a prescription drug or check our bank balance.
We are expected to interact with labor-saving technology without
realizing that its labor transferring technology. The job has not been
saved, its been taken out of the paid sector
She goes on to give specic examples:
Patients now buy do-it-yourself kits to test and track everything from human
immunodefciency virus (HIV) to blood pressure.
Every operation short of brain surgery is done on an outpatient basis.
Nursing care has been outsourced to family members whose entire medical
training consists of TiVo-ing Greys Anatomy.
Weve become our own computer geeks as help lines become self-help lines.
We are expected to be healthcare analysts, determining which drug
prescription plan covers our ever-changing prescription drugs.
Outside of healthcare, customers now make their own airline reservations and
print their own boarding passes.
Goodmans points are overstated to emphasize that the self-service movement
is not a positive development for time-stressed consumers. However, healthcare is
not just another product that consumers can passively receive without any personal
investment of time, money, and energy. In addition, much research evidence shows
the benets of patient involvement. The lesson here for healthcare leaders and
providers is to be cautious in deciding which healthcare services and experiences
are appropriate for the patients and families to coproduce. See Exhibit 9.1 for a
summary of these advantages and disadvantages.
DETERMI NI NG WHEN PARTI CI PATI ON MAKES SENSE
Sometimes coproduction benefts both the organization and the patient; some-
times it benefts no one. Determining the who, what, when, where, why, and how
of patient participation depends on a variety of factors. Generally speaking, par-
ticipating in the service is in the interest of patients when they can gain value,
improve quality, or reduce risk. Participation is in the organizations interest when
it can increase patient satisfaction, save money, enhance operational efciency, gain
a competitive advantage, or build patient commitment and loyalty. Each opportu-
nity for patient participation should be assessed on these criteria.
230 Achieving Service Excellence
Value, Quality, and Risk
Almost every patient is happy to coproduce if it adds value to the experience. By
denition, value can be added by reducing patient costs (for the same quality),
increasing healthcare quality (for the same costs), or both. Costs include not only
the price but also the other costs incurred by being involved in the healthcare
experience. For example, if a potential patient sees that the parking lot or the wait-
ing room of her walk-in clinic is full, she may go to a different clinic if the cost of
waiting is too great. With this choice, the patient risks experiencing a decrease in
quality but expects a decrease in time cost to compensate for it.
Similarly, patients who want to be sure of service quality may want to participate
in providing the service. Those patients want to know they are getting the service
tailored to their specic needs, wants, and expectations. Patients can participate
in providing the service without actually handling instruments or reading charts,
such as in discussing with their physicians what clinical procedures and treatments
might lead to the desired clinical outcome. In the past, patients followed doctors
Exhibit 9.1 Advantages and Disadvantages of Patient Coproduction
For Patient For Organization
Advantage Disadvantage Advantage Disadvantage
Reduces service costs Could be frustrating Reduces labor costs Increases liability risk
Increases interest Could diminish
service quality
Improves patient
satisfaction about
outcome
Increases patients
training costs
Saves service time Patient knowledge,
skills, and abilities
are inadequate
Reduces service
failures
Increases employee
costs
Improves service
quality
Learning curve too
steep
Opens new market
niche
Increases design costs
Reduces risk of
disappointment
Enriches employee
jobs
Interferes with work
of other units
Could enhance
satisfaction
Increases patient
loyalty
Too much variability
in patient KSAs and
motivation
Chapter 9: Involving the Patient and Family in Coproduction 231
orders without question; today, patients are more involved in this type of decision
making. If the doctor says, Take two aspirin and go to bed, the patient may ask,
Why?
Many consumers, including healthcare consumers, have become activists re-
garding the goods and services they buy. Patients believe they can improve the
quality of the healthcare experience when they can choose among available op-
tions offered or described by the provider. Computer-savvy patients often derive
their own second opinions from medical advice on the Internet. They may also
visit medical websites or chatrooms and news groups to interact with people with
the same medical conditions. Such information empowers many patients decision
making.
Customer and Organizational Reasons
Some research suggests that two factors are of primary importance to patients: time
and control. When patients can save time and/or gain control, they are more likely
to want to participate in their own care.
With time, the perception of how long a procedure takes is as important as the
actual length of time of the procedure. The same is true for control. The perception
of control over the quality, value, risk, or efciency of the experience is as impor-
tant in determining the value of participation as the actual control. For example,
patients are sometimes given real control over their pain medication. They are al-
lowed to administer more pain medicine when they decide the pain is too great;
having this control adds to patient satisfaction.
From the organizations point of view, the most obvious reason to encourage or
require coproduction is to achieve higher levels of patient satisfaction; another rea-
son is to save money. As noted earlier, whenever a patient produces or coproduces
a service, the patient is providing labor the organization would otherwise have to
pay for. A third reason is to enhance operational efciency or increase capacity
utilization.
If patients are allowed or encouraged to do more for themselves, the staff can
attend to other patients with more immediate needs. In this way, the organiza-
tion can maintain a constant stafng level while still being able to accommodate
the variability in patient demand. Simply, letting patients coproduce part of the
healthcare experience increases the number of patients who can be served.
An organization can also use patient or family participation to boost its com-
petitive advantage. For example, a hospital may distinguish itself from others by
using nurse midwives, instead of the typical obstetrics team. Another example is a
232 Achieving Service Excellence
real-time, secure website from which patients and family members can get infor-
mation about their test results or interact with their providers.
A nal reason for coproduction is to build patient commitment and repeat busi-
ness. If a patient believes the organization trusts him enough to let him participate
in his care, then the patient feels a bond and a commitment. He feels ownership in
that experience, which leads to feelings of loyalty to the organization that offered
this opportunity (Berry and Seltman 2008).
Many service organizations try hard to build such relationships because they
recognize the lifetime value of a loyal repeat customer. Frequent fyer and frequent
patient programs are both designed to build this attachment so that customers
come back time after time to the organization that knows them. Frequent patient
programs provide various rewards to repeat customers, such as preferred rooms or
locations and facilitated intake and discharge. Benchmark healthcare organizations
understand that their customers have many choices concerning where they will
receive health services. Consequently, these organizations offer more incentives to
keep the loyalty of their customers.
Costs Versus Benefits
The key to deciding when to offer the patient the opportunity to participate is to
do a simple costbenet analysis. The organization needs to be sure that the bene-
ts of participation outweigh the costs. The costs and benets of patient and family
involvement need to be reviewed to nd the point beyond which the incremental
benefts are outweighed by incremental costs (Prahalad and Ramaswamy 2004b).
The organization should ask itself the following questions (Elwyn et al. 2000):
What are the KSAs necessary to perform successfully as a quasi-employee?
Are all, some, or none of these KSAs likely to be found in the quasi-employee?
What is the motivation for a patient to participate, and how does the
organization appeal to that motivation?
What are the training requirements for successful performance in the quasi-
employee role, and does the organization have the time and staff to train the
quasi-employee in that role?
Will the quasi-employee come back and use the training the organization
provided? If so, the investment of time, money, and staff may be worthwhile.
Is it cheaper, faster, or more effcient for the organization to provide the
service or to allow the quasi-employee to do it?
Chapter 9: Involving the Patient and Family in Coproduction 233
Are role models (especially other patients) available to help with training
the quasi-employee, and how can the service environment be physically
structured to take advantage of these role models?
Will letting patients produce their own experience interfere with service
to other patients or with other parts of the organization?
For patients to be effectively used in the healthcare experience, they must have
the motivation and ability to participate, training, and KSAs. Also, their specic
functions need to be clearly dened. Organizations that see mutual benets to
coproduction and hence encourage it must always have a backup plan to accom-
modate the fact that some patients will not want to participate in the experience.
Those organizations that nd ways of using patients and their families as much as
possible will, however, decrease their costs and increase the value and quality of the
service for the participants.
Letting Patients Decide
Many situations lend themselves to using some self-service or patient participation.
An organization can follow two strategies when leaving the participation decision
to patients:
1. Communicate to the service population that every patient is expected to
participate in some of the interventions. Clarify the degree of involvement
for example, patients who seek counseling must agree to share information
and cooperate with the therapist. By clarifying the level of involvement,
patients are aware that they will not be expected to do manual tasks, such
as clean their own bathrooms.
2. Offer segments of the patient population a choice to participate. For example,
group therapy patients might be told that verbal participation, although
it is to their advantage, is not required. Physical therapy patients might
participate or not, depending on their energy levels and the extent of
their injury; if patients are unable, therapists can continue to exercise the
muscles for them. As an additional example, some patients may prefer to
visit the organizations website, or they may opt to receive information from
a human being. If the patient chooses the latter, the organization should
provide contact names and phone numbers.
234 Achieving Service Excellence
Firing the Patient
In a sense, all patients coproduce, or have the potential to coproduce, the health-
care experience for other patients simply by being in the vicinity. A well-mannered,
well-dressed patient sitting quietly in a waiting room is an enhancement to the
setting, even a role model for other patients. On the other hand, a boisterous and
obnoxious patient in the same waiting room will scare off other patients.
Extreme behaviors from staff or patientsbeing verbally and physically abu-
sive, refusing to comply with reasonable organizational rules and policies, making
outrageous demands, or endangering themselves and othersare unacceptable in
any healthcare setting. Not all employees work out, just as not all patients work
out. The organization can do something about both groups.
If the patients performance as a quasi-employee is unsatisfactory, the organi-
zation must, as a last resort and employing clearly dened procedures, re the
patient. A quasi-employee may also be red for deliberately damaging or stealing
equipment and for disrespecting and abusing the staff. The organization should,
of course, give the patient the benet of the doubt, and the dismissal should be ac-
complished with minimal harm to the patients physical or mental well-being and
dignity. A patient who feels unfairly treated and who is angry about being termi-
nated may become a source of long-term negative publicity and even lawsuits. (See
Sidebar B for example.)
SIDEBAR B:
FIRING THE PATIENT
Firing the patient may be inconsistent with the
organizations mission, as this real-life example
illustrates.
Doctors and nurses at Highland Hospital in
Oakland, California, complain about the irrespon-
sibility, rudeness, and bad smell of a patient who
has serious heart and blood pressure problems.
She begs lunch from hospital staff and bums
cigarettes from strangers. She has been jailed for
belligerence in the emergency department (ED),
and a restraining order has been placed against
her, banning her from the hospital unless she is
receiving medical care. She refuses to coproduce
her healthcare experience and throws her pre-
scriptions in the trash to ensure further trips to
the ED. The patient seems ready for a pink slip.
But Highland is a public county hospital with
a mission to serve all who come in with a medi-
cal problem, whether they can pay or not. As
a result, the hospital cannot re the patient,
who has presented in the ED more than 1,200
times, costing taxpayers close to $1 million
(Foster 2001). While the patient has reduced
her use of the ED, the hospital still continues
to serve her. Highland also cannot police dif-
cult patients or prevent them from using the ED
because of its mission to serve everyone who
shows up at its door.
Chapter 9: Involving the Patient and Family in Coproduction 235
In some instances, patients are red not because of inappropriate behavior,
but because of nancial reasons (i.e., limits on reimbursement for specic services)
or because of the organizations inability to provide needed care for the patients
changed condition. Assisted-living facilities re their patients when they need
nursing care services. Nursing homes re their patients when their health ben-
ets run out. Hospitals re patients when their doctors think they are ready for
discharge, whether the patients agree or not, or when their HMOs refuse to make
further payments. HMOs fre their Medicare patients due to excessive regulation
and inadequate reimbursement by the federal government.
Although ring a patient may be a response to a patient failure of some kind,
the organization must sometimes realize that it has also failed in some way. The
rude, troublesome patient had expectations, whether reasonable and realistic or
not, and the organization failed to meet them.
CONCLUSI ON
Coproducing the healthcare experience offers many advantages for both the organiza-
tion and the patient. However, these advantages will not be realized if the organiza-
tion does not provide training and support for the staff and the quasi-employees or
informal caregivers. In addition, the organization must gauge patients KSAs and
willingness to participate in their care. To achieve this kind of motivation, the or-
ganization needs to make clear how coproduction benets the patient.
Providers should be encouraged to attend to the interpersonal aspects of their
interactions with informal caregivers to promote coordination that will ultimately
benet the patients health. This can be done through building shared goals, shar-
ing knowledge, and developing mutual respect among employees, patients, and
other informal caregivers, but dedicated resources and support are needed to facili-
tate this process.
Service Strategies
1. Hire and train your service personnel to coach, monitor, and supervise
customers (e.g., patients, family, friends, clergy) coproduction.
2. Train patients to participate, and be sure they have the required
knowledge, skills, and abilities for coproduction.
236 Achieving Service Excellence
3. Restructure patient rooms to encourage family and friends to visit,
coproduce, and share an adjoining room.
4. Motivate patients who derive value and quality from participation to
coproduce.
5. Determine which patients, family members, and friends are motivated to
become informal caregivers and to coproduce a healthcare experience.
6. Encourage patients to help monitor the service behavior of employees.
7. Encourage all patients and families to become informal caregivers. Always
provide an option for staff service if that is preferred by patients and their
families.
8. Structure healthcare experiences in ways that encourage patients to train
other patients; provide pretreatment videos or prepare patients to engage in
the experience.
9. Preserve the patients dignity if you need to fre him.
P A R T I I I
The Service System
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239
Communicate everything you can to your associates.
The more they know, the more they care.
Sam Walton
C H A P T E R 1 0
Communicating Information Internally
and Externally
Service Principle:
Keep the patient, family, and employees informed
When confronted with uncertainty about a medical condition or any phase
of the healthcare experience, most patients seek information to reduce their anxi-
ety. Although they can readily obtain information from various sources, including
the Internet, patients often look to their healthcare providers for answers. Thus,
providers have to be prepared to meet the information needs of not only patients
and their families but also employees, payers, and other stakeholders.
Sharing information is a big challenge in healthcare, as the eld is not known
for its pioneering use of information technology and is restricted by many privacy
protections for patients. Ideally, providers and delivery systems must nd the right
balance between facilitating a health information exchange and safeguarding pa-
tient privacy.
In this chapter, we address the following:
How health information systems are integral to the three components of the
total healthcare experience: product, setting, and delivery system
The use of Internet technology in information access, healthcare decision
making, medical practice, and cost reduction
How information systems can meet all the needs of the organizations
stakeholders, not just the business needs of the organization or the clinical
information needs of providers
Advantages and disadvantages of health information systems
240 Achieving Service Excellence
THE VALUE OF HEALTH I NFORMATI ON SYSTEMS
A well-designed information system gets the right information to the right person
in the right format at the right time. In this way, the system is viewed as adding
value to a persons decision. A system is useless if it does not deliver the right infor-
mation to the right person in the right format at the right time. For example, an
x-ray image that arrives after a doctor has already prescribed a course of treatment
is a useless piece of information.
Patients, staff, clinicians, other caregivers, payers, and other stakeholders all
have information needs that the organization must meet.
Informing Consumers
The information the organization provides to patients helps make the intangible
service tangible. This is an underdeveloped but critical concern of a health in-
formation system. What information should the organization provide, in what
format, and in what quantity to help create the experience the patient and other
stakeholders in the healthcare experience expect? For example, if the experience
is a surgical procedure, the operating team should organize all the information it
provides to enforce the perception that the procedure is proper and will result in
an excellent outcome.
The surgical theater should be a sterile, well-equipped, well-laid-out room, and
clinical team should be wearing clean surgical gowns, gloves, and head caps. Such
environmental cues send this message: Relax. You are in the hands of a skilled
surgical team in a high-tech hospital. One of the authors of this book remembers
being wheeled into surgery and noticing the clinical team standing around the
room chatting and drinking Cokes. They did not seem to care that the message
their casualness was communicating was not of reassurance or professionalism.
Because most patients cannot differentiate a surgical team with a good record from
a surgical team with a bad record, the onus falls on the organization to carefully
manage the preoperative procedures, facilities, patient-contact employees, and any
other aspect of the care to ensure all these elements of the care communicate clini-
cal competence. Whatever the patient tastes, touches, hears, sees, and smells makes
up the information the patient receives, which in turn inuences her perception of
the total healthcare experience.
All of the informational cues in the service setting should be carefully thought
out to communicate what the organization wants to communicate to the customer
about the quality and value of the experience. The less tangible the service, the
Chapter 10: Communicating Information Internally and Externally 241
more important these cues will be. Information can glue together the product, the
environment, and the delivery system that make up the total healthcare experi-
ence. By managing this information with the use of an appropriate, reliable health
information system, the organization can ensure that the service is seamless and the
customers needs, wants, and expectations are met or exceeded.
Similarly, an organization should also pay attention to the information needs,
wants, and expectations of its internal customersphysicians, other clinicians,
managers, and other employeesin designing and implementing a health infor-
mation system. Clearly, organizations can use information to add quality and value
to the total healthcare experience.
THE GROWI NG ROLE OF WEB- BASED TECHNOLOGY
The Internet has greatly expanded the ability of healthcare organizations to com-
municate with their many customers. Exchange and dissemination of information
and services are easier, cheaper, and faster on the Internet, which is rapidly chang-
ing the dynamics of healthcare delivery.
In 2000, futurist Russ Coile Jr. summarized the Web-based strategies and activ-
ities in which healthcare providers and healthcare-related business would engage.
Clearly, many of Coiles predictions have come to pass and are still relevant today:
1. Advertising: Healthcare providers will communicate to consumers directly
and inexpensively through the Internet.
2. Providers: Healthcare consumers will use the Internet to identify the best
local, regional, and national providers.
3. Customer information and referral: Health insurers will use the Internet to
communicate with their enrollees about benets, referrals, physicians on their
networks, and medical information.
4. Shopping: Health-related products and services will be sold online more
quickly and at lower prices. Examples include prescription and over-the-
counter drugs, medical supplies and equipment, vitamins, and home tness
equipment.
5. Internet pharmacy: Discounts and home delivery will encourage many
consumers to get their prescription rells through online pharmacies.
6. Health insurance: Health insurers will provide online functions for consumer
registration, eligibility verication, and transaction processing.
7. Electronic medical records: Hospitals will become virtually paperless. All
stakeholders will be able to get medical information online, which they can
242 Achieving Service Excellence
use to diagnose, treat, or make a decision about their care. Patients will be
able to access their own health records electronically, which will help them
monitor their own health status.
8. Health advice and telemedicine: Health advice will be available through a
variety of websites, although not all such advice will be valid or evidence-
based. Telemedicine will allow institutions to provide diagnostic, consultative,
and clinical services.
9. Customer service: Most health insurers and delivery systems will offer
transactional capabilities for consumers on their websites. Examples include
verication of health plan eligibility, explanation of benets, search for
plan-approved providers, after-hours inquiries, online enrollment, and
appointment scheduling.
Just one year later, an article in the Wall Street Journal (2001) also forecasted
the practice of medicine in the twenty-rst century, in particular the growing role
of technology:
Within a couple of years, patients all over the U.S. could have secure
electronic medical records and go online to schedule appointments,
shop for the best hospital, look up lab results, track the status of a
claim, order a new drug or consult with a specialist. With existing
technology, doctors can interview and examine patients hundreds
of miles away or teach colleagues computer-aided surgery via the
Web. There are pilot electronic monitoring systems to keep track of
chronically ill people at home, and portable medical-alert devices that
can monitor them on vacation. Computerized ordering systems in
hospitals can help eliminate medication errors. Powerful data systems,
if specially designed to link hospitals around the country, can analyze
huge amounts of medical information and share it over a network
to help identify and treat public health threats before they spread.
Unfortunately, the chances that any of these innovations will actually
show up at your local hospital anytime soon are remote. Unique
among American industries, healthcare lags so far behind in adopting
the latest in information and communications technology that some
experts say it may never catch up.
The number of advances in information technology since the Russ Coile and
Wall Street Journal articles published, along with the call to action for the health-
care industry to embrace more innovation, has turned most of these predictions
Chapter 10: Communicating Information Internally and Externally 243
into a reality. The growth in information technology use is important for three
major reasons: It reduces costs, improves patient safety and healthcare quality, and
increases patient access to healthcare knowledge.
Many Web-based patient services save time and money for both the provider
and the patient. Cleveland Clinic, for example, gives its patients secure access
to its website to view their test results and medical records and update their per-
sonal data. This is just the beginning of patient-controlled Web-based health-
care databases. Several websites, including Google Health, Dossia, MEDecision,
Microsoft Health Vault, and Revolution Health, allow patients to post their
own medical data and designate who can access it; they also provide links to
relevant sources of health information (Kornblum 2008; Green 2007). Kaiser
Permanente offers e-visits (virtual doctor offce visits) to make 24/7 healthcare
access possible. Relay Health is another resource for virtual doctor visits (Wessel
2008). In developing countries and rural/remote areas where healthcare is not
easily accessible, telemedicine offers a low-cost option (Scott 2006; Wallauer et
al. 2008).
Information technology also improves patient access to healthcare knowledge
(Laing, Hogg, and Winkleman 2004). Websites on just about every healthcare as-
pect are available for consumers, including those that help with the following:
Diagnosing symptoms (e.g., WebMD.com, Familydoctor.org)
Keeping medical records (e.g., www.mychartlink.com)
Determining what questions to ask a doctor (e.g., www.ohri.ca/decisionaid)
Finding experts on medical conditions (e.g., MyConsult on www
.eclevelandclinic.org)
Evaluating medical practitioners and healthcare providers (e.g., www.ratemds
.com, www.HospitalCompare.hhs.gov, www.QualityCheck.org)
Giving family and friends updates on a patients condition (e.g., www
.caringbridge.org)
Social networking sitessuch as Facebook, Plaxo, and Twittermay also be
used to put a patient in constant communication with family, friends, and other
associates about personal and health issues. In addition, specic websites exist for
the following:
General health topics (e.g., www.healthfnder.gov, www.webmd.com, www
.mayoclinic.com)
Prescription drugs (e.g., www.pharmainfo.net, www.ditonline.com)
Heart conditions (e.g., www.americanheart.org)
244 Achieving Service Excellence
Cancer (e.g., www.oncolink.com, www.cancer.org)
Health plans (e.g., www.ahcpr.gov/consumer)
Personal health profles (e.g., WebMD.com; see Sidebar A for more on
personal health records)
Health screenings and comprehensive health awareness initiatives (e.g.,
www.impacthealth.com)
Consumers must exercise caution when visiting these and other websites be-
cause not all such sites provide valid, accurate, and up-to-date information. Some
of these websites may violate patient privacy rules, and their databases may be
tampered with or hacked, providing access to names, credit card numbers, health
records, or other personal data.
In spite of these efforts to better use information technology to improve the
effectiveness and efciency of healthcare, these improvements cannot come fast
enough. According to Noor (2007), healthcare is the largest industry in the United
States, representing about 16.5 percent of the gross domestic product, and it is
estimated to grow to 20 percent by 2015. This is a large resource commitment,
and any improvements will translate into very big numbers. An estimated 30
to 40 percent of healthcare expenditures go to ineffciency involving duplication,
systems failures, unnecessary repetition, and poor communication (Noor 2007).
Creating a system that manages information effectively is one of the most impor-
tant and challenging issues facing any healthcare organization.
The Internet as a Powerful Tool
Online bookstores, newspapers, travel agencies, schools, and other services have
transformed their respective industries in numerous ways. The same is true for
healthcare, as the examples earlier illustrate.
SIDEBAR A: PERSONAL HEALTH RECORD
A personal health record (PHR) not only im-
proves patientphysician communications but
also enables the patient to take control of her
medical les and thereby become an active par-
ticipant in her care (Tang and Lansky 2005; Ball,
Smith, and Bakalar 2007). Ongoing research at
the Cleveland Clinic conrms that patients like
the exibility of reporting blood pressure mea-
surements at their convenience and as they are
needed (Moore 2009). This entails moving the
patients information from the doctors ofce to
the patients home. Adoption and ongoing use
of PHR can facilitate this clinic-to-home link. The
PHR represents a fundamental change in our tra-
ditional system (Tang and Lansky 2005).
Chapter 10: Communicating Information Internally and Externally 245
The data contained on the Internet are immeasurable, and no one really knows
how many health-related websites exist. The search engine Google has become a
primary tool for many healthcare consumers and providers who seek information
and resources about medical conditions. In 2007, 56 percent of American adults
more than 122 million peoplesought information about a personal health con-
cern, up from 38 percent in 2001, according to a national study by the Center
for Studying Health System Change. From 2001 to 2007, use of the Internet for
information purposes doubled to 32 percent (Tu and Cohen 2008).
Tu and Cohen (2008) report that signicant increases in Internet usage were
observed across all consumer categories of age, education, income, and race/ethnic-
ity, and health status. Although elderly Americans65 years and oldersharply
increased their information seeking online, they still trail younger Americans by a
substantial margin. Consumers who actively researched health concerns widely re-
ported positive impacts: More than half said the information changed their overall
approach to maintaining their health, and four in ve said the information helped
them to better understand their illness (Tu and Cohen 2008).
Medline, the National Library of Medicines online search service, was visited
by nearly 50 million visitors in the second quarter of 2008 (Kronstadt, Moidud-
din, and Sellheim 2009). Medline is a gold mine of healthcare information, pro-
viding access to more than 10 million articles published in medical and healthcare
journals. MedlinePlus also offers extensive information on more than 750 diseases
and conditions from the National Institutes of Health and other trusted sources.
The website includes a listing of hospitals and physicians, a medical encyclopedia
and a medical dictionary, information on prescription and nonprescription drugs,
health alerts from the media, and links to thousands of clinical trials. (See also the
National Library of Medicine, National Institutes of Healths website at www.nlm
.nih.gov or the Medical Library Associations website at www.mlanet.org.)
Decision-Making Aid
The Internet is also breaking barriers to competition in healthcare because it en-
ables patients to seek alternative treatment options, discover medical developments,
and question the quality and cost of healthcare services. Such information is em-
powering, making patients less inclined to have blind faith in their doctors ability,
knowledge, and recommendations. In fact, many patients seem to trust Google
more than they do their doctors. Physicians are being confronted by patients who
are fully informed about cutting-edge treatments and the various implications of
their medical conditions or symptoms. Some patients may even know more than
their physicians about drugs and interventions that are little known, under inves-
tigation, or in clinical trials.
246 Achieving Service Excellence
Further, consumer-initiated/hosted websites allow patients who share a disease
or an ailment to directly communicate with each other to ask questions, explore
treatment options, and evaluate the treatment they currently receive. Nearly every
disease has a dedicated website, and their impact on the practice of medicine has
been growing (Landro 2007d).
In some states, including Ohio and New Jersey, patients can even go to a web-
site to nd out if their doctors have been disciplined (e.g., www.state.oh.us/med).
Similarly, those interested in the quality of specic nursing homes can now make
that assessment by visiting www.medicare.gov/nhcompare.
Information on physicians and their practice, health insurance companies, and
medications are also available online:
Physicians and practices: www.ama-assn.org; www.bestdoctors.com
Health insurance companies: www.ncqa.org; www.ehealthinsurance.com
Prescriptions: www.nabp.net; www.rxaminer.com
Some healthcare providers may view the availability of this much information
with alarm, but the Internet has a huge potential to improve health as it presents
information that may prevent illness, complications, and even death. The Inter-
net helps providers nd more resources (e.g., medical research and data, disease
experts, community partners) and extend their connections with patients well be-
yond the physical settingall in a cost-effective way.
Telemedicine
Telemedicine is the practice of providing medical care and advice or performing a med-
ical procedure from a distant location. It relies on electronic connection, such as the
telephone, the Internet, or some other communication device. For example, patients
with severe chronic wounds, such as those associated with diabetes and circulatory
diseases, may consult with their doctors via the Internet. A patient may take a picture
of the wound and transmit the image electronically; on the basis of this picture and a
conversation with the patient, the physician may make a decision to ask the patient to
come into the ofce for further consultation or to instruct the patient to monitor the
wound at home. The benets of such an approach include a reduction in visits, preven-
tion of hospitalizations, access to remote medical services, and lower costs.
Sentara Healthcare has an electronic ICU (intensive care unit), a system that
takes advantage of Internet technology to ensure that all of the systems ICUs
(spread across a wide area) are appropriately staffed with specialists at all hours.
Using video feeds and real-time connection, the electronic ICU ensures no lag in
servicesthat is, an ICU patient in a different location receives timely, high-quality
care from a physician many miles away (Mullaney 2006).
Chapter 10: Communicating Information Internally and Externally 247
Medem is an example of a growing number of companies that run websites
to facilitate physicianpatient communication. The company established the
Health Care Notication Network to deliver urgent patient-safety alertssuch
as medication and device recalls, warnings, and label changesto their physician
clients. Medems system also helps doctors manage their increasing use of e-mail to
communicate with patients. Physicians can check on patients and give diagnoses
through e-mail instead of ofce visits to manage time more efciently. (See www
.hcnn.net for more information.)
Electronic Recordkeeping
The use of Internet-based information technology to eliminate paper errors in
hospitals and clinics is advancing rapidly as well. For example, SingHealth in
Singapore created the Digital Hospital, a cutting-edge innovation in healthcare
informatics. The Digital Hospital is supported by three main pillars: (1) digital
ward; (2) digital clinic; and (3) telecare, telemedicine, and home care. The Digital
Hospital works in the following way (Stockholm Challenge Event 2008):
1. Information sharing. Inpatient discharge summaries, allergy information,
and medical alerts are exchanged between clusters. Such a system facilitates
clinical decision making, which improves patient safety and care
management.
2. Empowerment. Clinicians and patients have anytime, anywhere access to
knowledge and information.
3. Improved patientdoctor relationships and care provision. Secure messaging
between clinicians and patients allows patients to manage their diseases or
check in for a medical review. Clinicians can institute early treatment to
reduce or prevent hospitalization and/or rene medication dosages.
4. Access to medical records. Clinicians have convenient access to patients
health information.
5. Time savings and convenience for patients and staff. Up-to-date patient
information is accessible online on a 24/7, 365-day basis, freeing up
patients time spent calling laboratories for test results. Nursing staff are
spared from retrieving and collating patient information to be reviewed by
physicians. SingHealth estimates a cost savings of $750,000 per ward.
6. Improved quality of care. System alerts for abnormal results, duplicate
medication orders, and drug interactions and allergy contribute greatly to
patient safety and appropriate interventions.
7. Cost savings. Patients can save as much as $100 each by avoiding repeated
laboratory tests and radiology procedures if they transfer to another
institution connected to the Digital Hospital.
248 Achieving Service Excellence
ProviderConsumer Connectivity
The Internet can link the many players in healthcare delivery, including patients,
families, doctors and other clinicians, pharmacists, hospitals, clinics, laboratories,
consultants, equipment and drug suppliers, and insurance companies.
For example, WebMD.com posts health news, alerts, and other information;
hosts message boards and blogs; promotes wellness and healthy eating; advertises
health and medical products, including prescription drugs; and offers practice-
management software to doctors. Similarly, Aetna debuted a website in 2008 called
SmartSource, a search engine designed specically for health and medical infor-
mation, including disease risks, costs, and local providers (see www.aetna.com/
showcase/smartsource).
Web-enabled providerconsumer connections can enhance clinical quality and
outcomes, prevent medical complications and errors, and improve patient satisfac-
tion. They can also reduce costs, as they arm health consumers with information
and alternatives.
Personalized Service
Information can enable organizations to personalize the service to make each cus-
tomer, client, or patient feel special. For example, the use of direct linkages can
allow a nurse who is monitoring many patients at many locations to contact a
person whose vital signs are deviating from normal. Patients may be unaware that
their vital signs are being monitored until they receive a phone call from an off-
location nurse, who greets them by name and gives them personalized attention
and instructions.
Information and information technology can improve the service itself. A bar
code on a prescription drug label includes a wealth of information. For example,
the bar code contains a real-time record of the medications disbursed, enabling
the pharmacy to automatically reorder more so that the drugs are available when
requested. Bar codes on patient records and wrist bands with radio frequency iden-
tication chips allow the hospital or local pharmacy to monitor the types of drugs
one physician is prescribing so that other physicians can be alerted to potential in-
teraction problems. Such technology can also help providers identify patient needs.
For example, if a doctor prescribes the blood-thinning drug Coumadin, the system
can suggest that the patient purchase a blood-monitoring device. (See Sidebar B for
another example of a personalized technological intervention.)
Chapter 10: Communicating Information Internally and Externally 249
I NFORMATI ON AND THE COMPONENTS OF THE
TOTAL HEALTHCARE EXPERI ENCE
The challenge of information systems is to gure out exactly how to gather the
right data, organize that data into the right information, and distribute that infor-
mation to the right people when and in whatever way needed. Effective healthcare
organizations recognize that quality information is often as important as quality
clinical service. Therefore, managers must identify the information needs of all
internal and external customers who receive or produce the three components of
the total healthcare experiencethe product, the environment, and the delivery
system. In this section, we explore the role of information in each component.
Information and the Service Product
Sometimes, information itself is the service product (see Sidebar C for an illustra-
tion of this concept). At all times, however, information provides cues that guide
customers favorable or unfavorable perception about the quality and value of the
product.
For employees and clinicians, generally, information is the product. It is the
thing they need to deliver a service or to make a decision about next steps. For
example, consider a rehabilitation therapy manager who must decide whether to
revitalize or replace a rehabilitation room full of outdated, obsolete, or underused
equipment. The manager will need data related to the service, such as rehabilitation
SIDEBAR B: SMART CARD
A 60-year-old male is rushed to the emergency
department. He is unconscious and thus cannot
provide any information to the emergency medi-
cal technicians (EMTs). Luckily, the EMTs nd a
smart card in his wallet.
A smart card is a credit cardsized device that
stores a persons health information, including
his condition, medications, and treatments re-
ceived. When inserted into an optical reader, the
smart card enables a physician or any other clini-
cal caregiver to access the persons information.
Like the PHR, smart cards are most effective when
loaded with updated information. Such informa-
tion is electronically transmitted to the card by
authorized people, such as a primary physician
during routine checkups and emergency depart-
ment staff in the event of an emergency.
Because the smart card is portable and holds
critical medical data, it helps providers give ap-
propriate and timely interventions.
250 Achieving Service Excellence
patient counts, room utilization rates, and wait times; she will also need patient
survey results and forecasts of future rehabilitation demand. Each set of such infor-
mation is a product produced and delivered by another employee or unit.
Providing information is the service activity of many employees, and bench-
mark healthcare organizations aim to be effective and efcient at this activity be-
cause they understand its signicance to the total healthcare experience. Indeed,
the entire movement toward patient-centered care depends on clinicians and em-
ployees having easy access to all patient-related information. Prompt, appropriate,
and high-quality patient care is impossible without a systematic way for staff to
obtain or exchange patient information.
Information as the product enables careful decision making, outcomes measure-
ment, and patient-centered approaches.
Information and the Service Environment
An information-rich service environment is useful to patients and other customers.
For example, in an outpatient imaging center, patients need instructions on how to
nd the x-ray room, how to prepare for the x-ray procedure, and what to do after
the x-ray image is taken. Directional signs should be placed and should be visible
throughout the center to facilitate the patients travel to the x-ray department.
Instructions should be given at the reception desk to tell the patient what to do
before and after the procedure.
On the organizations website, pictures of the setting help potential patients see
the intangible product as a tangible service. Such graphic representations inform
patients of the quality to be expected from the facility. Many organizations post
images of patient rooms, the lobby, waiting rooms, staff and clinicians at work,
the equipment, and views from room windows. In a larger sense, the environment
SIDEBAR C:
DRUG INVENTORY MANAGEMENT SYSTEMS
AmerisourceBergen, a pharmaceutical distribu-
tor, has mastered information exchange with its
independent drug store afliates. Through a so-
phisticated electronic system, the company pro-
vides afliated pharmacies with comprehensive
information, including data on sales, inventory,
and drug interactions.
In addition, AmerisourceBergen helps its af-
liated drug stores manage their inventories by
monitoring the movement of drugs and sundry
items sold by the stores. This system benets
AmerisourceBergen as well, as it allows the
company to offer just-in-time restocking service
based on its knowledge of consumer purchase
patterns.
Chapter 10: Communicating Information Internally and Externally 251
itself can be thought of as an information system by the way it is designed and laid
out. That is, the presence or absence of navigational tools can enhance or detract
from the service experience. This information ranges from a simple orientation
map to interactive, computerized kiosks.
Information and the Service Delivery System
Information is required to make the service delivery system work. That system
includes the people and the processes by which the service and any accompanying
tangible product are delivered to the patient. The nature of the service product,
setting, and delivery system will determine the ideal information system.
For example, in a routine checkup at a physician practice, the patient is seen by
a nurse or nurse assistant rst. The nurse takes the patients vital signs, asks the rea-
son for the visit, and makes notations in the patients chart. Then, the nurse com-
municates the information to the physician, who goes into the examination room
where the patient is waiting. After the checkup, the physician leads or instructs
the patient to go to the reception area, where the patient may receive prescription
orders from the doctor or set up a follow-up appointment. This example illustrates
the information system generally in place in a doctors ofce.
Many doctors offces use color-coded fags to indicate the stage to which the
patient has moved along the delivery system. At each stage, the patient receives
information that will guide him through the next steps.
Information on Service Quality
One important use of a health information system is in the systematic gathering
of information on service quality. Acquiring this information, organizing it into
a usable form, and disseminating it to managers and providers aid in identifying
and resolving problems. Entering complaints into the information system about
patients annoyance with the constant paging of doctors over the intercom, for
example, is a rst step. But this step is worthless unless the manager and all others
involved are alerted promptly of the complaint as soon as it is entered. An effective
information system is designed to issue notications and reminders so that some-
one can follow up on any concerns or problems.
The information system should be designed to ensure that all the people in-
volved in delivering a service have the information they need to do their jobs in
the best possible way. Here is where the most powerful applications of modern
252 Achieving Service Excellence
information technology have been developed. Providing the healthcare employee
with the information necessary to satisfy and even impress the customer is an ef-
fective way to add value to the healthcare experience.
Customers today are used to fast service. They can pump gas at a self-serve sta-
tion 18 seconds after paying. As patients, these same customers get frustrated when
they have to wait 10 minutes for their prescriptions to be reflled or for a nurse
assistant to fetch an extra blanket. The difference between a gas station service and
a clinical service may not be readily apparent to many patients.
Consider the task of checking a patients insurance coverage in a doctors ofce.
To the patient that task should be as simple as presenting his insurance card, which
generally contains all the necessary information. The ofce, however, needs more
information than the insurance carriers name, the plan number, and the copay
amount. Unless the patient is receiving the same services as in previous visits and
unless the ofce has a current master list of all services covered by all insurers and
all their plans, the process of checking will take time and may cause delay. Patients
are naturally unhappy about such waits.
The situation, however, is changing rapidly for insurance verication tasks.
Information systems, especially Web-based systems, make it possible for the
healthcare staff to provide service to customers quickly and efciently in many
situations. Indeed, this is the area in which the healthcare industry has worked
the hardest to capture the benets and economies of technology without losing
the human contact that is so vital to the healthcare experience.
It is a high-tech world, but because technology has taken over so many func-
tions that used to be performed by people, patients value a high-touch experience
even more than before. Healthcare organizations try to use as much technology as
they can both behind the scenes and in direct patient contacts; this gives employees
enough time to offer the personal attention patients value so much while still of-
fering efcient patient care.
Electronic Expertise
In a number of innovative ways, information technology allows organizations to
provide expert skills without paying experts to provide them. Rural hospitals, for
instance, can have online access to major teaching hospitals where expertise is avail-
able around the clock. Rural hospitals do not use specialists enough to make it cost
effective to have them on-site all the time.
The evolving availability of evidence-based medicine databases, such as the Cochrane
Collaborations Cochrane Library (see www.cochrane.org/reviews/libintro.htm), is also
Chapter 10: Communicating Information Internally and Externally 253
making greater expertise available through an online connection. This powerful
tool allows clinical providers from the local general practitioner in a remote town
to the specialist at the university hospital to log in from a bedside and access the
best available knowledge and expertise on a medical condition and its treatment
(Carey 2006). If this knowledge can be provided through an Internet connec-
tion in the patients room, through a touch-screen device, or even through an
employee who can easily access a computerized database, the cost to the patient
and the organization of providing that expertise is reduced and the quality of the
information and the ease of access are increased. This is an exciting illustration
of how information and information technology can be used to enhance the or-
ganizations ability to provide a valuable service for the patient.
Customer-Contact and Healthcare Support Groups
Another major part of the healthcare service delivery information system ties to-
gether the customer-contact group (those people and functions serving healthcare
customers) with the healthcare support group (those people and functions serving
the people who serve the customers). Coordination between these two geographi-
cally separate groups in the service delivery system is critical to providing a seamless
experience for patients. Patients do not care if the communications system between
the pharmacist (who belongs to the healthcare support group) and the nurse (who
belongs to the customer-contact group) is faulty. Patients care only about the qual-
ity of the total healthcare experience, and the organization is responsible for pro-
viding the quality by ensuring that things happen the way they should, such as the
right prescriptions getting to the right patient at the right time.
To illustrate, say a patient undergoes a physical exam in a primary care physi-
cians ofce. If the physician does not have a laboratory to do medical tests on-site,
the patient might be asked to visit a medical laboratory, have certain tests done
under certain conditions (e.g., after eating no food for eight hours), and have the
lab fax/e-mail back the results to the physicians ofce. The probability of seamless
service in such a situation is low even when directions for both the patient and the
lab are extremely clear.
Information Flow Across and Between Organizational Levels
The last major requirement of the information system in service delivery is to move
information between organizational levels. This level-to-level ow of information
254 Achieving Service Excellence
can take the shape of a simple employee newsletter or a document with a rout-
ing slip, or it can be embodied in a sophisticated online, real-time, wireless data
retrieval and decision system. Information can also be provided through a cen-
tralized database or intranet that is accessible to all employees, allowing them to
retrieve specic information on corporate policy, dates and places of training op-
portunities, or availability of job openings within the organization.
All of these methods of communication, whether on a piece of paper or through
increasingly sophisticated electronic devices, are additional ways healthcare manag-
ers can reinforce cultural traditions, motivate employees, and educate them to en-
hance the healthcare experience. Of course, many other communication channels
fow up and down between management and employees. Employee-of-the-month
programs, for example, allow the organization to communicate to all employees
the types of behavior desired and rewarded. Employee suggestion programs are
another way for management to pick up new ideas and other types of informa-
tion from their employees that enable quick identication of problem areas in the
service delivery system.
Perhaps the most problematic example of information ow between levels is
the chronic miscommunication problem between nurses and physicians. For ex-
ample, illegible physician handwriting can result in a nurse misreading the or-
ders, which can then result in tragedy. John Kerry and Newt Gingrich, in a 2007
joint editorial arguing for e-prescriptions, noted that medication errors kill at least
7,000 Americans annually. Furthermore, of the more than 3 billion prescriptions
written annually, more than 1 billion, or one third, require follow-up between the
provider and the pharmacies for clarication (Kerry and Gingrich 2007). Noor
(2007) reports that 98,000 patients die each year because of medication errors,
many of which result because the nurses could not decipher the physicians hand-
written prescription.
Technology can provide an avenue for improving such problems by provid-
ing a common database that records and tracks everything the physicians order
for a patients care and everything all the clinical employees do in executing or
implementing those orders. Indeed, in more sophisticated systems, orders can be
automatically forwarded to other units and logged into schedule books so human
error is eliminated in information transmission. Handheld devices and computers
can link doctors various databases to ensure that patients get the right medica-
tion. Such devices can also alert doctors if one of a patients drugs conicts with
another.
The Leapfrog Group encourages healthcare organizations to practice transpar-
ency and to make healthcare information more easily accessible. Leapfrog also
recommends giving rewards to hospitals that have a proven record of high-quality
care. (See www.leapfroggroup.org.)
Chapter 10: Communicating Information Internally and Externally 255
Information technology also allows organizations to effectively outsource func-
tions that are beyond the core competence of an organization. McKesson, for ex-
ample, can operate a pharmacy for a hospital and ensure compliance with all rules
and regulations and provide service at a level of quality that is consistent with the
healthcare organizations mission.
A study reported by Kim (2005) found that outsourcing the supply-chain man-
agement system for drugs enabled hospitals to improve the procurement processes
and inventory control of pharmaceutical products and decreased total inventory
by more than 30 percent. Because the drug wholesaler can share information with
hospitals, it can gather more timely and exact data about inventory status and drug
usage volumes of hospitals. This allows the company to forecast the demand more
accurately and supply needed products more cost effectively and quickly.
ADVANCED I NFORMATI ON SYSTEMS
Two types of advanced information systems that do more than simply provide in-
formation are decision systems and expert systems, which help users analyze infor-
mation and choose between alternatives. Decision systems are particularly useful
to organizations that want to establish lasting relationships with patients. Expert
systems are sometimes called articial intelligence. Both systems constitute the
informatics infrastructure of benchmark healthcare organizations.
Decision Systems
Decision systems help clinicians make decisions, and sometimes, they replace the
decision maker altogether. An example of a decision system is a monitor at the nurses
station that sounds an alarm when a critical care patients blood pressure is too low.
A decision system can replace a decision maker when real-life situations can be accu-
rately modeled. In these cases, the decision system is programmed with information.
The system will automatically respond according to the information it received.
For example, an intravenous drip programmed to increase the glucose percent-
age if the monitor registers a certain drop in the glucose level will respond without
the prodding of a clinician.
Other models of decision systems include inventory reorders of medical sup-
plies, pre-preparations of surgical trays on the basis of statistical projections, and
home monitors that automatically dial 911 when certain vital signs register in the
danger zone. All of these activities can occur without any human intervention and
based solely on the data gathered and organized by the information system.
256 Achieving Service Excellence
Decision Modeling
Decisions may be modeled when the relationships among the measured factors are
generally predictable. However, typically it is not worth an organizations time and
trouble to do the necessary research and data gathering to develop a mathematical
model describing the situation and to discover the appropriate decision rule un-
less the decision is one that occurs frequently or comes up in a large number of
patients.
For example, an inventory system might have a built-in, preprogrammed re-
ordering capability that ensures the continuous availability of necessary drugs
without overordering. The challenge is to ensure that the system collects the data
necessary to measure the depletion of inventory, so the nurses using the drugs can
dene their usage rate fairly accurately. This way, the nurses know how much of
each drug they need to keep on hand and that the ordering system can accurately
predict how long it takes to reorder and receive the necessary products. A system
can be designed to collect and analyze this information to ensure that the proper
quantity of each necessary drug is maintained in inventory.
As is true of any procedure designed to improve service to patients, the or-
ganization needs to assess the relationship between the value and the cost of the
information before it establishes such a system. Because nurses are busy service
providers and not accountants, they may not get around to gathering and organiz-
ing data on medical supplies often enough to justify the expense and sophistication
of an online system. If data input is haphazard, the value of the information is low
because it will be frequently out of date, and the expense of installing a sophisticated
system is unwarranted.
Expert Systems
Expert systems seek to duplicate the decision process used by an expert who gathers
information, organizes it in some way, applies a body of expertise to interpreting
the information, and makes a decision. An expert system is built by nding out
what information an expert uses, how that expert organizes it, and what decision
rules that expert uses to make decisions based on the information.
Once these pieces of information are collected, usually through extensive inter-
viewing of an expert or a group of experts, a series of decision rules can be writ-
ten to duplicate the decision-making process of the expert. Healthcare journals
frequently offer new illustrations of expert systems that assist clinicians in a wide
variety of applications of these powerful systems. As clinicians face the same ex-
plosion of knowledge that all managers face, they will increasingly rely on expert
Chapter 10: Communicating Information Internally and Externally 257
systems to help sort through the volume of information to nd the best solutions
to healthcare problems.
Decisions Requiring Judgment
Expert systems can be developed to facilitate decision making in a wide variety of
recurring situations that require expert judgment. For example, expert systems can
schedule personnel to ensure proper stafng levels and keep track of hospital room
inventory to ensure maximum use for each days inventory of available rooms.
Expert systems can be used whenever a straightforward algorithm or mathematical
formula can calculate the best or optimal answer for a problem. In these types of
expert systems, the optimal answer can be determined once the data are gathered
and analyzed by the algorithm and expert judgment is applied.
The key to using expert systems is to nd the right experts, identify the criteria
they use in making decisions, program their decision rules in a logical sequence,
and apply the program to problems that lend themselves to computerized analysis.
This creates a category of decisions that can be made 24 hours a day for any person
having access to the system. For example, a pharmacist wanting to fnd out about
interactive effects of a newly prescribed medicine can call up the system from a
remote terminal, at any time of day or night, and ask the system to investigate any
possible interactions with the drugs the patient is taking.
Clinical decision support systems (CDSSs) are computer-based information
systems containing thousands of treatment options for different diseases. They are
designed to help in the diagnosis and treatment of illnesses. Some CDSSs simply
collect, organize, and communicate data about patients to physicians, but oth-
ers, such as the Cochrane Collaboration, actually use medical databases to suggest
diagnoses and treatment regimens. Some CDSSs are expert systems that contain,
rst of all, a general knowledge base of medical information supplied by experts.
Clinical information about particular patients is related to the information in the
knowledge base. The computer then uses decision rules to draw conclusions and
make recommendations to the attending physician.
Following are some examples of ways expert systems are used in healthcare:
A computerized system accurately monitors the fetal heart rate during the
birth process. A rule-based expert system uses heart-rate data to classify the
situation as normal, stressed, indeterminate, or ominous.
A smart pillbox monitors and reminds patients with human immunodefciency
virus (HIV) to stay on their drug treatment regimen. The pillbox is connected
to a medical expert system that analyzes patient information and provides
258 Achieving Service Excellence
Web-enabled reports and urgent outbound alerts to caregivers when patients
miss medication or suffer declining health.
An expert system can analyze hospital billings to spot irregularities in
doctors charges, classication of charges, and specication of charges.
An expert system can detect and alert staff about adverse drug events such
as allergies, unpredicted drug interactions, and dosage problems.
BayCare Health System in Tampa, Florida, and PeaceHealth system in Bel-
levue, Washington, are two examples of healthcare systems that have purchased
TheraDocs Expert System Platform, which combines real-time monitoring with
an expert CDSS. Using the systems capabilities, these two organizations monitor
hospital-acquired infections and adverse drug effects. The expert system allows
the organizations to not only monitor these specic problem areas but also offer
solutions (Business Wire 2008).
The existence of expert systems has far-reaching implications. As expert systems
that are capable of providing up-to-date data and recommendations based on ex-
pert opinion become more widely available, physicians may become obligated to
use them. Not to do so might leave them open to legal liability for not using state-
of-the-art methods for diagnosis and treatment.
Articial Intelligence
More advanced applications of expert systems open the way to the use of artifcial
intelligence (AI). AI is used in situations where some decision rules are available
but they are incomplete because part of the decision process is unknown or too un-
predictable to model accurately. AI programs are designed to allow the computer
to learn from successes and failures by ensuring that all the decisions it makes have
a feedback loop, which allows the result of implementing the decision to be fed
back and tested against predetermined evaluative criteria to nd out whether the
decision was good or bad. If the outcome was good, the logic the decision process
used is afrmed. If not, the feedback allows the computer to learn not to make
the same mistake the next time it faces the same situation.
The simplest and classic illustration of AI is a chess-playing program. A com-
puter can be programmed to behave like an expert chess player who knows all
the rules and the traditional chess gambits. As it plays games against various op-
ponents, however, the computer can also learn which moves lead to bad outcomes
and which moves lead to good outcomes. Over time, this knowledge accumu-
lates to improve the computers decision-making capabilities just as accumulated
knowledge improves the capability of a human expert.
Chapter 10: Communicating Information Internally and Externally 259
Adding a learning capability moves an expert systems sophistication level up to
that of an AI application. The use of AI is still limited because of the cost and time
required to develop this learning capability and the cost of errors while the learning
takes place, but even so, AI has a following: The Artifcial Intelligence in Medi-
cine Europe (AIME), which started in 1991, holds an annual meeting that offers
a forum to expand the applications of this powerful decision tool in healthcare
settings. From diagnosing congenital heart disease to scheduling patient tests to
developing treatment protocols, AI can be a useful tool in absorbing the complex
interdependencies of the human anatomic system and the volume of new science
that advances the treatment of healthcare problems. AI never sleeps, learns con-
tinuously, and offers consistent expert advice, so some believe it may be the only
way for the human mind to adapt to and incorporate the increasingly complex
world of clinical knowledge.
Advantages and Disadvantages of Advanced Systems
As Exhibit 10.1 shows, there are good reasons to use these systems, such as the fact
that they give users instantaneous access to a decision maker who makes quick,
consistent decisions, which may be critical for an emergency department doctor
seeking a quick consultation on a tricky diagnosis. These systems also have dis-
advantages. For example, the user cannot ask further questions if the problem or
query is not quite what the model expects.
Customers have unique needs, and expert systems have to be designed from the
customers point of view if they are to be truly useful in problem solving within an
organization. Because of the potential problems indicated in Exhibit 10.1, expert
systems should not be used for trivial, unimportant, or infrequent decision situ-
ations; they are simply too expensive. Expert systems should not replace human
decision makers in life-and-death situations either. They may, however, add greatly
to healthcare quality by making medical expertise available at any time and any
place to assist an attending physician.
PROBLEMS WI TH I NFORMATI ON SYSTEMS
No healthcare organization is likely to abandon its information system, but these
systems can present potential and actual challenges, including (1) information
overload, (2) overfocus on the numbers, (3) bad information, (4) no assurance
260 Achieving Service Excellence
of security and confdentiality, and (5) diffculty of weighing the systems value
against its cost.
Information Overload
Information systems are helpful and revolutionary but far from perfect. Too much
information is as bad as not enough. Although sophisticated systems are designed
to provide only the right information to the right person when that person needs
it, many information systems provide a lot of raw data that users have to sort
through until they can nd the needed information. As these systems are being
designed, planners ask users what information they need. Most users will ask for
as much information as they can get, instead of only as much as they really need.
Most people believe it is better to have too much information than not having
enough, and the proof is that they have seen people disciplined or even sued for
having too little information but never for having too much.
A second aspect of this issue is that, when asked, most people indicate that they
use many different informational data sources, instead of mentioning the one or
two they actually use. Not wanting to admit ignorance or own up to how little
information they use, they ask for a lot and then get lost in the pile. Everyone has
Exhibit 10.1 Advantages and Disadvantages of Advanced Information Systems
Advantages Disadvantages
Makes consistent and impartial decisions
Makes decisions quickly
Rapidly sorts through large amounts of
information
Frees up experts from making routine
decisions
Allows instantaneous 24-hour access to a
decision maker
Retains expertise forever
May make bad decisions if problem is not
routine
Eliminates human participation in decisions
Assumes that experts will reveal decision-
making secrets and rules
Some decision processes are too obscure to
duplicate in expert systems
May present legal issues regarding who owns
decision rules
Circumstances may change too quickly for
the system to keep up
May frustrate users whose problems do not
exactly t system parameters
Chapter 10: Communicating Information Internally and Externally 261
done a Google search only to be overwhelmed by the millions of sites that appear.
Benchmark healthcare organizations collect and feed back a lot of information on
customer satisfaction but must make sure the information is in a format that is ac-
cessible and useful.
Overfocus on the Numbers
Because computers excel in transmitting, organizing, and analyzing numbers,
much computer information is in numeric form. Although this format helps data
be converted into information accurately, it tends to focus attention on only those
things that can be quantifed or somehow expressed in numerical terms. Much
of a healthcare managers life revolves around subjective, qualitative information
rather than quantitative data. The availability of numeric information creates an
overemphasis in decision making on such information and an underemphasis on
qualitative information. Many clinicians believe medicine is an art, so trying to
determine what data should be processed to accurately represent the practice of the
art is a difcult challenge.
Bad Information
Regarding data collection, the old saying that garbage in leads to garbage out is
quite true. A sophisticated information system can quickly provide a lot of bad
data to a lot of people; if bad data get into the organizations decision-making
structure, the data will be plugged into multiple calculations used in many decision
situations. What if the wrong fnancial information is submitted to Medicare, or
the wrong lab result gets into the system? The results can be worse than garbage;
they can be catastrophic.
No Assurance of Security and Confidentiality
How can the integrity of the database be maintained? This is an enormous chal-
lenge in healthcare. Information systems have to be protected so that one orga-
nization cannot access condential or proprietary data from another and so that
only authorized persons can gain access to patient information. Although it is still
possible in many hospitals for anybody to walk into a hospital room and look at
a patients chart, the concern over computerized medical records has led to a wide
262 Achieving Service Excellence
and deep conversation about patient rights to privacy and how to protect that pri-
vacy in an age of digital records.
In this era of telemedicine and doctors working at a distance, connected to the
information system by modem or computer terminal, protecting the integrity of
the database from unauthorized or inappropriate access is an important concern.
If hackers can get into the computers of the U.S. Department of Defense, as they
have, then competitors or others may well be able to get into healthcare databases.
Protecting against such unauthorized entry is a big problem and big expense for
organizations. The problem exists even internally, as database managers need to
ensure that unauthorized persons cannot obtain condential patient data.
Acquisition of private healthcare data by unauthorized users is one problem;
misuse of private information by authorized users is another. Hospitalized patients
are often unaware that many employees look at their health records without per-
mission. Upon discovering the easy accessibility of this information, some patients
request for their records to be kept condential and for a list of people who ac-
cessed their le to be kept.
Despite the passage of the Health Insurance Portability and Accountability
Act (HIPAA) in 1996, many organizations continue to face increased pressure to
prot from their patient health data. Because of HIPAA, hospitals ceased to ask
patients which medical information they wanted shared and which they wanted
private. Patients access to their own records became impossible, yet the same
information could be released to other entities, including providers, employers,
government agencies, insurance companies, billing rms, transcription services,
pharmacy benet managers, pharmaceutical companies, data miners, and credi-
tors (patientprivacyrights.org 2009). This situation may change if the consumer
protection included in the Obama administrations stimulus package is enforced.
This little-known provision prohibits the sale of personal health information, with
exceptions for research and public health purposes. Also, this protection mandates
organizations to inform consumers if their Social Security number or medical in-
formation is hacked or stolen (Freudenheim 2009).
Breach of Electronic Medical Records
News reports of privacy breaches related to electronic medical records appear regu-
larly. In June 2008, Walter Reed Army Medical Center notifed 1,000 patients of a
privacy breach (Ottenheimer 2008). Just a few days earlier, the University of Cali-
fornia at San Francisco had disclosed that it had notifed more than 3,000 patients
of a privacy breach in its pathology department. The Wall Street Journal reported
that complaints of privacy breaches in the United States reached 23,896 for the
period between April and November 2003 (Francis 2006).
Chapter 10: Communicating Information Internally and Externally 263
Based on a 2006 study by the Markle Foundation, although a majority of Amer-
icans believe electronic data can improve care, 80 percent are very concerned about
the risk of access without their authorization, including access related to marketing,
identity theft, and fraud. The Association of American Physicians and Surgeons
published a similar study in 2007, which found that 70 percent of patients asked
doctors to suppress information because of privacy concernsthis means that
doctors did not put information in patient records for fear that someone (e.g., an
employer) would use the data against the patients. In addition, 50 percent believed
control of their records was already lost (Ottenheimer 2008). Patients have a right
to be concerned. During the course of a typical hospitalization, approximately 150
people are estimated to have access to a patients medical record (Fried 2007), and
medical identity theft has been made easier by the ability of criminals to hack into
hospitals online fles (Faust 2007). Clearly, the security and privacy of information
in the healthcare system is a growing concern to everyone involved in healthcare
regulators, healthcare organizations, and consumers alike.
Difficulty of Weighing Value Against Cost
Information is not free. Buying data terminals and computers, hiring program-
mers, running a wireless data network, and building an information system are
hugely expensive. Yet many of the benets of an information system are intangible.
How does one measure the value of instantaneous access to a patient database so a
patient can be greeted by name, the information necessary for excellent patient care
is immediately available, and the patients unique requirements can be identied in
advance and supplied? And how does one measure the cost of problems, including
fatalities, that an adequate information system might have avoided?
In To Err Is Human: Building a Safer Health System, the Institute of Medicine
(IOM 2000) stunned the U.S. public by reporting that up to 98,000 people die
each year from preventable medical errors. In Crossing the Quality Chasm: A New
Health System for the 21st Century, the IOM (2001) said the industrys problems
had increased. Still, not much progress has been made in applying advances in
information technology to improve administrative and clinical processes (IOM
2001). A 2008 study by the Agency for Healthcare Research and Quality found
that one of every ten patients who died within 90 days of surgery did so because
of a preventable medical error. The study also found that preventable medical er-
rors cost nearly $1.5 billion annually (Encinosa and Hellinger 2008). The Obama
administrations emphasis on improving health information systems afrms how
little progress has been made thus far.
264 Achieving Service Excellence
Determining how much better a decision was because the manager or clinician
had the right information available is usually impossible. Yet most organizations
believe their systems are worth the cost. The problem is that when budget time
comes and paybacks on investments are calculated, defending information system
upgrades and improvements is difcult because evaluating the contribution of such
a system is diffcult. Still, companies can make estimates. About 85 percent of
medical practice revenues come from insurance reimbursements, but the average
time for processing claims is between 45 and 90 days. The assumption is that the
cost savings of more efcient claims processing will exceed the cost of the required
investments.
Cost of Learning the System
Top managers and physicians are the very people who need to learn how to use
information technology, but they are often the very same people who are most
uncomfortable and unfamiliar with it. Worse yet, given the problems in quantify-
ing the value of the technology, these are the same people who make the decisions
about buying the equipment, investing in the system, and getting trained to use it
effectively. A lot of learning has to take place before those who are uneasy talking
about MP3s, Twitter, and podcasts are totally comfortable using the new electronic
information system.
Even though increasingly user-friendly software makes it easier for managers to
learn and use the powerful technology, the challenge is that as soon as they master
one technology, a newer and more powerful one will inevitably come along that
they will need to learn as well. Busy managers, clinical staff, and others in the
healthcare system cannot learn about information systems once and then forget
about them. The rapid changes in what computers can do in managing informa-
tion require all participants in the healthcare system to change as fast. This takes
valuable time, which is a major challenge.
HEALTHCARE ORGANI ZATI ONS AS
I NFORMATI ON SYSTEMS
Perhaps the easiest way to understand how information ties the healthcare organi-
zation together is to consider the organization itself as a big information network.
Everyone is a transmission point on the organizational network, gathering, send-
ing, and processing information into a decision-friendly format. Those responsible
for designing the organization as an information system must consider how all
Chapter 10: Communicating Information Internally and Externally 265
these network participants are linked together and what each participants informa-
tion needs are.
If an admitting clerk is responsible for taking a phone call from a family mem-
ber inquiring whether a relative has been admitted and, if so, what that patients
medical status is, then the information system had better be designed to obtain and
provide accurate information to the clerk when the phone rings. The system design
will therefore require communication linkages, across all parts of the organization,
that provide access to all information needed by the clerk so that the clerk can
respond helpfully and accurately. Reengineering the organization and its informa-
tion system to focus on the needs of patients and their families is a necessity in the
present-day competitive healthcare marketplace.
The Primacy of Information
The logic of organizing around the ow of information changes the way jobs are or-
ganized, tasks are performed, operations are sequenced, and departmental units are
organized. The organization should be designed in a way that responds to informa-
tion requirements. Jobs and departments dealing with uncertain, ever-changing,
and ambiguous situations require a lot of information from many sources to ensure
that the managers responsible for decisions on those units can get all the informa-
tion they need to make those decisions. Jobs or units that are relatively insulated
from uncertainty, ambiguity, and changing circumstance may not require the same
volume or quality of information; they can likely anticipate that whatever hap-
pened or was true yesterday will be pretty much the same today and tomorrow.
Organizational units facing uncertainty need to add the information capacity
that will allow the necessary information to be gathered, or they must nd ways to
reduce the need for that information. Both strategies involve integrating the orga-
nizational design into the information system and vice versa.
Increasing Capacity
When the organization must increase its information-handling capacity, its system
designers must look at all the ways information is transmitted across the organiza-
tion. They will probably have to build an expert-level system with the capability to
screen out unnecessary information while conveying necessary information. Fur-
thermore, the system will have to create redundant sources of critical information.
266 Achieving Service Excellence
Information a decision maker absolutely must not miss should be provided in
more than one channel of communication to ensure that the end user has it when
it is needed. That way, if one channel breaks down or fails, the information can be
provided through another means.
A simple example is sending someone an e-mail, followed by a fax, followed
by a mailed hard copy, with the same information in all three communications.
Building in this redundancy obviously creates additional demands on the informa-
tion system, and organizations should carefully consider what information is so
important that it needs to be sent in more than one way.
Reducing Need
The organization can seek ways to reduce the need to handle information. One
major way to do this is to create self-contained decision-making units that are
empowered and enabled to make decisions about their areas of responsibility. By
increasing the number of decisions made at the point where the information is
generated, the use of information channels is reduced. This is the classic strategy of
decentralized decision making or, in the more current literature, the trend toward
individual or group empowerment.
The idea here is that with proper training in asking for job-related data and
turning these data into information used for decision making, the individual em-
ployee or department can make many decisions that otherwise would have been
routed up the administrative chain of command. The time and effort it takes to
check with a supervisor or higher-level organizational unit can use up information
channel capacity, but even worse for a healthcare organization, it also slows down
the response to the problem. If a furious patient is complaining to an employee,
that patient does not want to wait until someone upstairs gives approval for resolv-
ing a problem.
Everybody Online
The most effective strategy for increasing the information ow is to put everyone
online with immediate and easy access to the relevant parts of the organizations
database via an intranet. Increasingly, rather than sending masses of information
through the communication channels, the trend is to put information on the in-
tranet so any employee with a computer terminal and the appropriate access code
can ask for it.
Chapter 10: Communicating Information Internally and Externally 267
Most organizations now have e-mail capability that allows any employee to ask
any manager or expert any relevant question electronically. The ow of informa-
tion back and forth across all levels of the organization and even outside the orga-
nization is incredibly enhanced by this technique. The increasing involvement of
healthcare organizations in regional and national information networks and their
rich databases and informational resources means even more information is avail-
able to anyone who needs it, whenever they need it. Frontline employees now often
have access to much of the same information their bosses have access to, and with
proper education about organizational goals and training in decision making, they
can make decisions of the same or better quality than their bosses could in previ-
ous eras.
Integrated Systems
The growth in interconnectivity has created an expanded ability to access useful
information.
One example is the formation of Premier in 1996. Owned by more than 200
of the nations leading not-for-prot hospitals, Premiers website claims that it op-
erates the nations largest healthcare supply purchasing network, the most com-
prehensive repository of hospital clinical and nancial information. (See www.
premierinc.com.)
One of the more elaborate networks of information interconnectivity has been
established in Oregon. The Oregon Community Health Information Network
(OCHIN) provides administrative services to 21 member organizations in more
than 100 locations, and it has more than 2,500 end users in private and public
health centers in both rural and urban settings. OCHINs stated goal is to provide
quality health information and management services to the safety-net community.
As a collaborative, OCHIN believes it can provide these services more efciently
and effectively than would be possible by individual organizations.
OCHIN was founded in 2000 as a department of CareOregon to address con-
cerns about the impact of an information technology gap in the eld of healthcare.
The belief was that, if unchecked, this technology gap would leave families in pov-
erty and with more expensive, less efcient, and less effective care than those with
access to mainstream systems of care. The founders of OCHIN also envisioned an
opportunity to secure signicant gains in quality healthcare for populations who
have tended to be most neglected by the healthcare system as a whole.
OCHIN leverages its size to purchase software that can make practice man-
agement and electronic medical records affordable for more safety-net clinics to
268 Achieving Service Excellence
implement and maintain. OCHIN seeks to subsidize the cost of the software
through grants and foundations.
CONCLUSI ON
The impact that these information systems have on empowering frontline em-
ployees to do their jobs better, quicker, and cheaper is astonishing today and
will grow even more so in the future. The implications of these changes for all
staff, who are responsible for accurately transmitting information from one part
of the healthcare system to another, are also important to consider in managing
the organization. Technological trends will continue to have a profound effect
on organizational design and frontline employee responsibilities, and healthcare
organizations will need to ensure that information is accurate and that they are
accountable for who uses it.
Electronic technology has changed and will continue to change the way orga-
nizations are structured and managed; it will also fundamentally change the nature
and role of employees who are concerned with delivering high-quality healthcare
experiences. The information systems of healthcare organizations should be de-
signed to incorporate all the components of the healthcare experience. Such a total
information system provides the needed information simultaneously to patients,
family, management, patient-contact staff, and even external stakeholders when
they need it and in a way they can use it. Achieving this end requires the system
designer to pay close attention to the needs of users and their capabilities and will-
ingness to use informatics to enhance the customer experience.
Service Strategies
1. Learn the unique informational needs of each internal and external
customer, and satisfy them.
2. Find out the value of communicating information, and be aware of the cost
of providing that information.
3. Make information available in a format that each customer expects, can
use, and will use.
4. Ensure access to information to people who need it, and exclude access to
those who do not.
Chapter 10: Communicating Information Internally and Externally 269
5. Put organizational information online, but protect confdential data.
6. Ensure that the information system generates and feeds back information
for those who need it.
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271
Being nice to people is just 20 percent of providing good customer service.
The important part is designing systems that allow you to do the job right the rst time.
Carl Sewell, Customers for Life
C H A P T E R 1 1
Delivering the Service
Service Principle:
Provide a seamless healthcare experience
Ensuring that only well-trained, clinically competent, motivated, enthusiastic
employees are serving patients is necessary, but it is not sufcient to produce an
extraordinary patient experience. A healthcare organization must also ensure that
the process by which the service is delivered is working as it should.
Healthcare managers often assume that the employee has made an error when
a service problem arises in any part of the healthcare experience. But the reality is
that frequently the fault lies in a poorly designed system that makes it difcult, if
not impossible, to deliver the service with the excellence that the organization, the
staff, and the patient want (Baker et al. 2008).
If you talk with nurses, admissions ofcers, and laboratory technicians, they
will tell you how frustrated they become when the service systems cannot help
them do the jobs they are hired, trained, and paid to do and want to do well.
When the service delivery system fails, everyone loses. The patient is unhappy, the
employee is frustrated, and the organization disappoints a patient and may lose all
the revenues the patients future business represents.
In this chapter, we address the following:
How to properly design the service delivery system to make sure all aspects of
the healthcare experience are provided as planned
How to plan, measure, and improve the system as illustrated by examples that
are applicable in real-world situations
272 Achieving Service Excellence
Techniques commonly used in the services sector and healthcare, such as
blueprinting, fshbone analysis, Program Evaluation Review Technique/
Critical Path Method (PERT/CPM), and simulations
How an organizations design should be considered part of the service delivery
system
Because the type of service will inuence the design of the service delivery sys-
tem (e.g., Sung-Eui 2005; Correa et al. 2007; Zomerdijk and Vries 2007), we will
focus on a more general discussion of tools that can help design the best delivery
system for healthcare applications.
CHECK THE SYSTEM FI RST
Kumar and colleagues (2008, 183) suggest that practitioners should focus on
process management to impact upon TSQ (technical service quality) rather than
simply addressing service quality from a functional perspective. Moreover, If
companies have problems in maintaining service promises, there is a requirement
to review the service delivery system: a system of interconnected processes which
deliver value to the customers. Achieving patient satisfaction and avoiding prob-
lems in the healthcare experience can both be greatly affected by delivery system
design (Prajogo 2006). Every healthcare organization should invest time and en-
ergy in studying and planning the entire system to get it right.
The total quality management (TQM) movement has taught organizational
leaders two important lessons:
1. Everyone is responsible for delivering quality and monitoring the quality of
the entire healthcare experience.
2. When a service failure occurs, the system must rst be checked for problems
before blame is passed down to people; after all, even systems of high-
performing service organizations fail from time to time.
Consider the following example of a system failure and the outcome that re-
sulted from employee involvement. After several doctors complained about their
x-rays not being brought to the operating room in a timely manner and not hav-
ing available x-ray technicians when needed, the chief operating ofcer (COO) of
General Hospital decided to act using a nontraditional approach. The traditional
managerial solution to the problem is to blame the staff. First, the section manager
is loudly criticized for technical incompetence, poor supervisory skills, and other
Chapter 11: Delivering the Service 273
unsatisfactory outcomes brought about by the entire department. Then, the disci-
plined manager transfers the fault and criticizes or disciplines the technicians.
But the COO had a different problem-solving approach in mind. He organized
a team of technicians and asked them to investigate the matter and to suggest ways
to solve whatever problem they found. The team did exactly that. They found out
that the cause of the problem was that not enough x-ray technicians were available
in the hospital when the surgeons needed their expertise. This inadequate stafng
level, the team discovered, resulted from a new managers decision to change the
hours of operation of the mobile x-ray unit. Some technicians served in both the
in-hospital x-ray unit and the mobile unit.
Previously, the mobile unit had been out in the eld only when no surgeries
were scheduled, but a new supervisor had taken over the mobile unit, had been
told to cut costs, and saw that costs could be cut by reducing the overtime hours
worked by the driver of the mobile unit. That reduction forced the mobile unit to
operate during some of the same hours surgeries were regularly scheduled.
As a result, technicians who used to be available for in-house x-ray work were
now sometimes out in the eld when their services were needed back at the hos-
pital. Because a new manager followed orders and tried to save some money in
the mobile x-ray unit, the rest of the system was disrupted. This cost-saving move
irritated the doctors, slowed down the surgical procedures for patients, and drove
up the costs of surgery because the operating rooms and surgical teams were tied
up for longer periods. Solving a problem in one part of the service delivery system
without thinking about its possible impact on the overall system created problems
for another part.
Three lessons can be drawn from this example:
1. Department managers often do not have enough time, information, or insight
to gure out the best solutions by themselves. These managers tend to nd the
simplest, quickest solution and rely on the traditional theory, addressing the
problem by correcting personnel.
2. Employees may have a better chance of nding the root causes of a problem than
the manager does because they are more involved in the actual process of operating
the system. Not using the talents, intelligence, and job-related knowledge of
employees is a waste of these human resources.
3. Every problem should be addressed rst from the perspective of the entire service
delivery system. Although one person may end up being the cause of a service
failure, the fault is frequently in the system and not a person. Simply putting
out one small re (we are spending too much money on overtime) without
thinking about the system can cause big problems elsewhere.
274 Achieving Service Excellence
Self-Correcting Systems
The goal of TQM is to use the people and the system designers to create a self-
correcting systeman environment in which employees can override the system
(or break the rules) to correct problems or failures. Employees in a self-correcting
system are responsible for telling management where the system has failed so they
can x it together. Just as everyone is responsible for providing and maintaining
quality, everyone is responsible for avoiding and xing service failures. The side-
bar illustrates two contrasting examples that highlight the importance of a self-
correcting system.
Because the patient is always the ultimate judge of the quality and value of the
healthcare experience, designers of the service delivery system must ensure that they
fully consider the patients point of view, not just the clinical employees perspective.
Although the system should be user-friendly for clinical employees, the system
must also cater to the patients needs, expectations, and capabilities. The service
delivery should be smooth, seamless, easy, and transparent from the patients point
of view.
ANALYZE THE SYSTEM
Analyzing the service delivery system has three major components: planning, mea-
suring or controlling, and improving. In the quality improvement literature, these
components are known as Jurans trilogy or the quality trilogy.
Any good delivery system must begin with careful planning, the rst compo-
nent. Years of experience in working with older people can give a new nursing
home administrator a good head start in designing a comprehensive treatment,
care, and recreation schedule. However, a careful analysis and detailing of every step
in the entire service delivery process that provides comprehensive care and physical
therapy for older people makes the difference between having it mostly right and
reaching the level of excellence that the very best service organizations deliver.
The second component is measuring for control. You cannot manage what you
do not measure, and this is especially true of service delivery systems. The service
industry in general, and healthcare in particular, have lagged behind in under-
standing how to apply measurements to the largely intangible patient services.
The need for measuring not only the clinical status but also the patient care status
in every step of the service delivery system is critical in understanding where any
service delivery problems are and how one can tell whether the attempted solutions
are actually xing the problem.
Chapter 11: Delivering the Service 275
SIDEBAR
A man was on vacation in France when he had a
sudden attack of gout. Having neglected to pack
his medication, he sought medical care from
a local doctor. He received treatment, paid the
bill, and kept the receipt for later reimbursement
from his insurance carrier. He did not call his car-
riers 800 number for authorization; that number
does not work in France.
When he arrived home, he sent the bill to his
insurance carrier for processing. The processing
clerk told him the bill could not be paid because
the expenditure, although made for a covered ail-
ment, had not been authorized. After several fruit-
less discussions and a brief phone conversation
with a manager, he still could not get reimburse-
ment. The rules did not allow reimbursement for
a reimbursable but unauthorized expenditure.
The clerk and its system both failed the patient.
The insurance carriers procedures were not suf-
ciently exible to handle the somewhat unusual re-
quest properly. The employee had been taught to fol-
low the inadequate procedures to the letter, and the
manager did not get sufciently involved to nd out
what was really going on. If the insurance carriers
employees had been sufciently empowered and
motivated, the failure might have been avoided.
Contrast this clerk with the motivated, em-
powered assistant administrator in the fol-
lowing example. The hospital administrator
told the assistant administrator to handle a
particularly difcult Medicare case. An elderly
woman frequently came to the hospital claim-
ing illnesses and diseases that required her
to be admitted. The billing clerk had noticed
that a large number of claims for treating the
woman were being sent to Medicare; the clerk
alerted the hospitals management to the pos-
sibility that the organization would be audited
if they did not stop admitting this malingering
patient. When the woman appeared again, re-
questing admission, the assistant administra-
tor was given the task of convincing her that
she should go home. After some discussion,
the woman agreed to leave if the assistant ad-
ministrator would take her home.
Because he knew the organizations philoso-
phy was to do whatever was necessary to satisfy
the patient, or at least try to, he agreed and drove
her to her apartment. The apartment was lthy
and showed signs that the old woman was un-
able to care for herself. The assistant administra-
tor was deeply affected, so he arranged to x the
place up and clean it and volunteered to come
back in a week to check on her.
When he arrived the next Friday afternoon, he
found the place in worse condition than before.
The power cords for the refrigerator, television,
and lights had been cut, and the phone line had
been snapped at the box. Upon the assistant ad-
ministrators questioning, the woman revealed
that her drug-seeking nephew had trashed her
place, as he did frequently, in search of money.
The assistant administrator called the hospital
and, even though the woman was not sick, ar-
ranged for an ambulance to transport her back to
the hospital so she would be safe until the police
caught the nephew.
The empowered assistant administrator
solved a problem by going beyond the regulations.
If he had not made two trips to the womans apart-
ment and had not brought her back to the hospi-
tal, the problem would not have been solved: the
woman would have continued to return to the hos-
pital for unnecessary and costly medical treatment
and the abuse would have continued. Through the
assistant administrator, the system healed itself
to achieve the organizations primary goal: patient
satisfaction. The system failed once when it con-
cluded that the woman was simply a malingerer
who needed to be sent home, but it redeemed itself
by giving the frontline administrator the autonomy
to solve the patients problems.
The points here are simple:
Study your system in intimate detail.
Design accurate early-warning measures
(Continued)
276 Achieving Service Excellence
Saying to a oor nurse, I want you to do a better job of satisfying patients
because patients on your foor seem unhappy, is easy but probably useless. Ex-
plaining to a nurse exactly what level of excellence was achieved last month, what
level is being achieved now, and what the measured target level is can be extremely
helpful.
In the best circumstances, when the measures are clear, fair, and completely
understood by the employees whose performance is being measured, employees
are able to measure and manage themselves. If you teach employees what is im-
portant to their individual job success and then train them to measure how they
are performing on those critical factors, you have the beginning of a self-managing
workforce.
Ideally, the measures can permit employees to monitor their own delivery ef-
fectiveness while actually delivering the service. For example, if a nurse knows that
the organizational standard for responding to a patient call is a maximum of three
minutes, and a computerized device displays a running record of how many min-
utes it takes for the nurse to answer calls, she knows at all times where she stands
in relation to the standard.
In addition to measuring employee performance, a good service delivery plan
should include a way to measure how well the plan is being implemented at every
step of the service delivery process and how well the overall plan is succeeding.
The measures should trigger an analysis of exceptions or variations from the plan
and should quantify every critical part of the healthcare experience and the total
experience. Most patients respond to the healthcare experience as a whole. Patients
usually know why they are satised by the healthcare experience if the clinical out-
comes were exceptionalthe heart transplant was a success, the malaria was cured,
or the therapy led to recapturing a physical capability.
SIDEBAR (continued)
for each of the many possible failure
points in both the clinical and nonclinical
parts of the healthcare experience.
Engage everyone in the organization in
watching those measures.
Empower employees to ignore policies and
rules that impede customer service.
Follow up on everything.
If failures occur repeatedly at certain points,
change the system design. If the organization
has a patient service guarantee, make sure the
delivery system can meet and exceed patient ex-
pectations on that guarantee. Excellent health-
care managers know they must keep a careful
eye on all the places where the system might fail,
and they do their best to keep these failures from
happening. All healthcare organizations should
design systems that ensure success and avoid
failure on the key drivers of an outstanding over-
all healthcare experience.
Chapter 11: Delivering the Service 277
However, in routine encounters, such as annual checkups, patients are often un-
able to identify how any one part of the experience inuences their determination
of the experiences value and their sense of satisfaction. They can, however, give an
overall impression of service quality that can trigger managerial investigation. If a
patient is unhappy with a visit to the clinic, the clinics managers will not know
why until they carefully collect and analyze the data measuring patient perceptions
of each step in the entire healthcare experience.
Management may not recognize that the dissatisfaction was caused by a long
wait in x-ray, a rude doctor, or a dirty restroom. Knowing the components of the
system and having the measures for each can trigger the necessary corrective ac-
tions. A well-designed service system will include a way to measure every critical
part of the patient experience and the experience as a whole.
After measurements have been developed, the third component in the analysis
of the service delivery system is improvement. Information about what is actually
occurring drives system improvement: If you can identify the failures, you can
gure out where to x the system. Once the plan is clearly laid out and the results
of implementing that plan are adequately measured to yield insights into how well
the system is operating, both management and employees have the information
needed to redesign the system or x the problems and thus yield continuing im-
provement in the healthcare experience.
A major factor in improving the system is training staff to put customer service
ahead of policies and procedures when the two conict and rule breaking does not
compromise patient safety or medical needs. Frontline employees are often the frst
to notice or be informed of system faults or failures. If they have been properly se-
lected, trained, and motivated, they will report the need for system improvement.
For example, a nursing aide responsible for responding to patient call buttons,
providing bed pans, and cleaning up was frustrated by the chronic understafng
that left him unable to respond promptly to patient needs. One day he noticed a
predictable pattern: The call buttons began lighting up for bedpan requests at the
same time food trays were delivered. He discovered that if he timed his visits to the
rooms before food delivery, he could often be walking into the room to provide
bed pans just as the patient was reaching for the call button. This nursing aide is an
example of a dedicated, motivated, observant employee who improved the system
by observing it.
The cycle of planning, measurement for control, and improvement should
never stop. The plan lays out what you think your service delivery system should
be doing, the control measures tell you if what you planned is in fact happening,
and the commitment to improvement focuses everyones attention on analyzing
278 Achieving Service Excellence
and xing any problems and moving toward a awless healthcare experience. The
point is that the design of any service delivery system should incorporate all three
elements.
SYSTEM PLANNI NG TECHNI QUES
The rst step in a customer-driven approach to service delivery system design is
planning out the steps and processes in the entire system. At this stage, a detailed
description of the steps involved is developed. Managers of benchmark service or-
ganizations start their planning by surveying their potential patients to determine
the key drivers of the experience from the customers perspective. Once those key
drivers are identied, the delivery system can be designed to ensure that patients
expectations regarding those drivers are met or exceeded.
If patient participation is included in the delivery system design, the plan should
account for the possibility that the patient may not or cannot participate in treat-
ment. For example, consider a professor who is used to having her healthcare needs
met at the medical school and group practice afliated with her university. She
moves to another town, and her new primary care physician recommends that
she visit a testing laboratory for certain tests. Accustomed to one-stop shopping
for healthcare, the professor does not go to the laboratory and instead nds a new
primary care physician who performs tests in the ofce. The rst doctors delivery
system planning should have taken this possibility into account and included mea-
surement of the key drivers of customer satisfaction with all parts of the delivery
system.
Four basic techniquesblueprinting, fshbone analysis, PERT/CPM, and sim-
ulationare commonly used to develop a detailed plan for delivering the health-
care experience. Managers can also use these techniques to focus on any aspect
patient feedback indicates is a problem area. These techniques are especially useful
because they can readily incorporate the measurements necessary for control and
analysis of problems that may appear in the system.
Each technique has its own advantages, but all are premised on the idea that a
detailed written plan leads to a better system for managing the people, organiza-
tion, information, and production processes that deliver the total healthcare expe-
rience. If effort and care are devoted to the plan, failures should be minimized. If
situations regularly get to the point where problem-solving and problem-recovery
techniques are necessary, some patients will inevitably become so dissatised that
they will not choose the provider again if they can help it.
Chapter 11: Delivering the Service 279
Blueprinting
Detailing the delivery system through a blueprint or service process diagram has
several immediate benets to managers seeking a fail-safe delivery of their service.
First, managers can better understand and study a diagram (in a fowchart form,
for example) that delineates all parts of the system. Second, managers can easily use
the diagram to show the plan to others.
Exhibit 11.1 is a simple fowchart of activities associated with a patients visit to
a physician ofce. All activities head toward and center on the patients consulta-
tion with the doctor. Each activity related to the offce visit must be successfully
planned, designed, and managed if the healthcare experience is to succeed. Like
most chains, the owchart is only as strong as its weakest link. Although some
activities are more important than others, each is a potential moment of truth that
can affect the quality or value of the experience from the patients perspective.
Employees must be trained and motivated to perform their responsibilities at
each step on the owchart. When a patient calls for an appointment, staff must an-
swer the phone promptly, be courteous and friendly, and nd the earliest mutually
convenient appointment time. If a patient arrives by car and parks, the organiza-
tion must make sure the parking area is clean and safe; if valet parking is provided,
the patient must be given information about it ahead of time. As the rst personal
contact with the patient, the valet must be helpful and friendly.
When the patient arrives at the front desk, staff must extend a friendly welcome
and explain what is going to happen and when. At sign-in, staff must provide all
necessary paperwork, help patients ll it out, and explain the organizations bill-
ing policies and procedures. During any waits, staff must stay in touch with the
patient, explain any undue delays, and provide estimates of how long the wait may
extend.
Although the patient may not be present at most other points of activity on the
chart, which usually involve different organizational units serving each other as
internal customers, those points must also be similarly managed. For example,
if the report of the patients lab work (upper right on the chart) is not completed
promptly and inserted into the folder sent to the nurse, the doctor will not have
the needed information at the consultation. Another consultation may have to be
scheduled, and the patient will be inconvenienced.
Blueprinting is a more sophisticated form of owcharting (Bitner, Ostrum, and
Morgan 2008). In effect, a good blueprint displays and defnes every component and
activity not just of the delivery system but also of the entire healthcare experience,
from the moment the patient sees the front door to the time the patient departs.
280 Achieving Service Excellence
Every event that is scheduled to happen in between is laid out on a blueprint, as
is every contingency that can be reasonably projected. The points at which service
problems are most likely to occur can be identied, and early-warning mechanisms
can be included.
The blueprint not only should present the activities and processes involved in
providing the service, but it should also include the time it takes to complete each
moment the patient sees the front door to the time the patient departs.
Every event that is scheduled to happen in between is laid out on a
blueprint, as is every contingency that can be reasonably projected.
Those points at which service problems are most likely to occur can
deli veri ng the servi ce 289
Figure 11.1 Flow Chart of a Typical Patient Office Visit
Patient phones for
appointment
Patient arrives,
parks car
Patient arrives
at front desk
Patient signs in
Medical records
office gets request
Records pulled,
folder prepared,
sent to nurse
Lab work done, report
sent to medical
records office
Nurse takes current
complaint, additional
information, and
vital signs and adds
info to folder
Patient waits
to be examined
Patient called to
examination room
Medical supplies
storage
Medical supply
vendor
Doctor consultation
Follow-up
scheduling/billing
Bill payment/
patient departure
Patient returns to
parking lot, leaves
Fotter/book 8/12/02 3:47 PM Page 289
Exhibit 11.1 Flowchart of a Typical Patient Ofce Visit
Chapter 11: Delivering the Service 281
activity. If an excellent clinical visit is provided in 20 minutes, a patient may feel
quite pleased; if it takes an hour, the patient may be satisfed; but if it takes two
hours, the disappointed patient may never return. Finally, providing the service ac-
cording to a well-designed blueprint will help the organization achieve its revenue
goals while maximizing the patient-experience quality and value.
Exhibit 11.2 shows a simple blueprint of an elementary school nurse treating
a playground injury. As diagrammed, the service begins with the nurse being told
that a child needs attention on the playground. The nurse goes to the child, exam-
ines the wound, applies antiseptic, and dresses the wound.
The blueprint of the service also shows an arrow dropping from the applica-
tion-of-antiseptic step to represent a potential area of failure where the nurse might
forget to bring the antiseptic. If this happens, the next step shown is for the nurse
to x the problem by going to the ofce or supply room and then returning to
the application-of-antiseptic step. The blueprint provides time estimates for each
step so the total time of the service experience can be calculated. The blueprint
also shows the line of visibility, which separates the events the patient can see from
those that cannot be seen.
Work cycle times are calculated from carefully studying the process. The entire
nished schematic shows the planned sequence of activities, shows the measures
for each step in the cycle of service, and provides an easily communicated picture
for analyzing the entire service cycle. The example in Exhibit 11.2 is simple and
incomplete, but it is a good starting point. An excellent school nurse or the health-
care manager for a school system will want to extend this schematic to include
certain events that happen before the nurse is summoned to treat a student.
The manager should start at the point where the overall strategy for student
health was established in the frst place. Doing so allows the manager to see all
the other inuences that have an impact on the students total healthcare experi-
ence, including its many other intangible and tangible aspects. The simple example
can be extended and completed by incorporating all the ne points of elementary
school nursing care; the blueprint can go into even greater detail by breaking down
each step into a detailed subroutine and by adding complementary services such as
administering shots, conducting hearing and eyesight testing, and doing wellness
counseling.
Other settings may require more elaborate blueprints. For instance, the
need to treat hundreds of people a day in a large emergency department, serve
dozens of people a day in a surgical center, or respond to countless phone calls
on a health insurance information line may require service delivery steps to be
broken down into highly specialized and routinized jobs to make the process
as efficient as possible or to make the process work at all. The challenging
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Nurse told of child's
injury (10 seconds)
Nurse examines and cleans
wound, applies antiseptic,
dresses wound
(3 minutes)
Figure 11.2 Blueprint for Nurse Treating Playground Injury
Nurse goes to child
(2 minutes)
Nurse writes up
report of incident
Nurse gives child
comfort and reassurance
(2 minutes)
Nurse goes to supply
area, gets antiseptic
Fail
point
(no antiseptic)
Line of
Visibility
Materials and supplies:
antiseptic, bandages
Seen by patient
Not seen by patient
but necessary
to service
Select and buy materials
and supplies
Source: Reprinted with permission from The AMA Handbook of Marketing for the Service Industry, published by the American Marketing
Association, edited by C. A. Congram and M. L. Friedman, 1991.
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Exhibit 11.2 Blueprint for Nurse Treating Playground Injury
Chapter 11: Delivering the Service 283
question about such jobs is how to retain the human interaction component
in the healthcare experience. The numbers of patients can be so large and the
service contact may take place so rapidly that even the most personable profes-
sional will nd it difcult to achieve a caring interaction with patients under
the circumstances.
Fishbone Analysis
Fishbone analysis was developed by Kaoru Ishikawa of Tokyo University in
1953. It provides a way to concentrate on the problem area and generally in-
volves the participation of the areas employees. Although a fishbone diagram
analyzes the causes of faulty service outcomes, it can be considered a planning
strategy because its results are often used to make major changes in the deliv-
ery system.
Exhibit 11.3 shows an application of this technique to a problem in the hy-
pothetical General Hospital chain: Too many blood donors show up at the blood
bank for their set appointment times and subsequently experience unreasonable
delays. The problem (delayed blood donation) becomes the spine of the sh in
Exhibit 11.3, which is derived from the classic Wyckoff (1984) study. The general
resource areas within which problems might arise that can delay blood donation
are attached as bones to the spine.
For example, equipment (which is a bone) is required to take blood promptly,
so this resource area becomes a potential source of delay if, for example, the equip-
ment is already in use or otherwise unavailable. All of the possible contributors to
the equipment failure are also shown as bones attached to the main equipment
bone. The potential contributors to resource failure are typically identied through
group discussion with the employees involved, as they should know the reasons for
treatment delays. General Hospitals employees use the shbone diagram to iden-
tify the possible trouble spots.
The resources required for receiving blood donations can be categorized as
equipment, personnel, material, procedures, and other. They are attached to the
spine (problem). Within any one of these categories, a problem can arise that
will cause the undesirable effect of unreasonable delays in serving blood donors.
The potential problems associated with each resource will then be identied,
listed, and prioritized by the employee group working on this problem. This
analytical technique is known as Pareto analysis, which is used to assess the
shbone technique by arranging the potential causes of the problem in order of
importance.
284 Achieving Service Excellence
:, achi evi ng s ervi ce excel l ence
Figure 11.3 Fishbone Analysis: Delays at the General Hospital Blood Banks
Equipment Personnel
Equipment unavailable
Equipment in use
Late equipment prep
Equipment failure
Inadequate maintenance
Equipment too old
Computer system breakdowns
Clinicians cannot process donors quickly enough
Clinicians arrive late
Too few clinicians
Clinicians untrained
Clinicians undermotivated
Late/unavailable office staff
Late/unavailable maintenance staff
Delayed
blood
donations
Other
Materials/Supplies
Disasters
Traffic jams
Weather
Inadequate bags
Inadequate needles
Inadequate antiseptics
Late record updating
Poor announcement of next clinician availability
Procedures
Acceptance of late donors
Desire to accommodate late donors
Reluctance to turn any donors away
Poor location of blood bank
Delayed check-in procedure
Donor confusion about whom to see
Issuance of towels/gowns
Donors bypass check-in desk
Donors see queue, come back later
Source: Adapted with permission from Cornell Hotel and Restaurant Administration
Quarterly, published by the American Marketing Association, D. Daryl Wyckoff,
1984, 25 (3): 158.
Fotter/book 8/12/02 3:47 PM Page 294
Exhibit 11.3 Fishbone Analysis: Delays at the General Hospital Blood Banks
Chapter 11: Delivering the Service 285
In Exhibit 11.4, the data representing the percentages of delayed service to
blood donors associated with each cause are listed next to the cause in order of
importance. The Pareto analysis revealed that about 90 percent of all service delays
at General Hospital chains were caused by only 4 of the approximately 30 possible
causes. The most frequent reason for delay at all hospitals combined was donors
being late for their appointments, followed by too few clinicians, late record updat-
ing, and computer system breakdowns. General Hospital realized that it was giving
immediate service to the donors who least deserved it: those who arrived late for
their appointments to give blood.
The data can also be analyzed by individual hospitals in the General Hospital
chain to see if the overall problems with blood donation are the same as those
found in each individual hospital. As the data show, both the percentages and the
reasons for delay at the Newark hospital are somewhat different from those seen
at the other hospitals. The fourth most frequent factor at Newark, failure of old
equipment, does not appear to be a problem for the Washington hospital, but
computer breakdowns do. By arranging the information in this way, managers
looking for causes of service delivery failures have an easily used analytical tool. For
each potential failure point, they merely collect and arrange the data the shbone
categories tell them to gather.
Recognizing the problem is the rst step in improving the service delivery sys-
tem; knowing the causes is the frst step in solving the problems.
Once the impact of late-arriving donors was identied, General Hospital de-
cided it would no longer wait for donors who did not arrive on time. Although this
solution seemed to contradict the hospitals desire to attract blood donors, and staff
naturally wanted to accommodate late-arriving donors, the hospitals in the chain
had clearly been denying timely service to the many donors who made sure to get
to the center on time.
By setting up this shbone analysis and comparing the survey data against the
key factors, the hospital group was able to identify the problem and discover a
solution that worked: Do not wait for anybody. Of course, that solution initially
caused a customer-relations problem with late arrivals, but General Hospital de-
cided that it was less serious than the problems that the late arrivals caused. As a
matter of fact, when word got out that General Hospital was not going to wait
anymore, fewer donors arrived late and the number of donors did not decline.
The individual parts of any delivery system can be broken down in the same
way to discover the other factorsequipment, staff, procedures, materialthat
may contribute to a service problem. Once managers measure each factors contri-
bution to the problem, nding a solution is relatively straightforward.
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Table 11.1 Pareto Analysis of Delays at the General Hospital Blood Banks
n o t g n i h s a W k r a w e N s l a t i p s o H l l A
Cause Percentage Cumulative Cause Percentage Cumulative Cause Percentage Cumulative
of Delay of Incidence Percentage of Delay of Incidence Percentage of Delay of Incidence Percentage
Late donors 53.3 53.3 Late donors 23.1 23.1 Late donors 33.3 33.3
T w e f o o T d r o c e r e t a L w e f o o
clinicians 15 updating 23.1 46.2 clinicians 33.3 66.6
r e t u p m o C w e f o o T d r o c e r e t a L
updating 11.3 clinicians 23.1 69.3 breakdowns
C d r o c e r e t a L t n e m p i u q e d l O r e t u p m o
breakdowns 8.7 failures 15.4 84.7 updating 9.5
Source: Adapted with permission from Cornell Hotel and Restaurant Administration Quarterly, published by the American Marketing
Association, D. Daryl Wyckoff, 1984, 25 (3): 158.
86.3
68.3
79.6
86.3
19 85.6
95.1
Exhibit 11.4 Pareto Analysis of Delays at the General Hospital Blood Banks
Chapter 11: Delivering the Service 287
PERT/CPM
Say you want to build a backyard barbecue. You design the barbecue and then buy
bricks and mortar. But once you go out to dig the foundation, you nd you do not
have a shovel and need to buy one. Finally, you start digging the foundation, and
while you are doing so your neighbor tells you that you need permission from the
neighborhood homeowners association before you can build a structure of that
size on your property.
The impediments to the process in this scenario are merely time wasters and an-
noyances to the barbecue builder, but these types of impediments can cause much
bigger problems to a healthcare organization. Healthcare organizations cannot af-
ford to start building a hospital or clinic and then nd out in the middle of the
process that it lacks material or permits to complete the project. When the plan-
ning and delivery of the service product involve different activities, and especially
when those activities recur in a repeating cycle (like planning a heart transplant or
rehabilitation therapy treatment), a helpful technique to use is PERT/CPM.
The PERT/CPM planning technique is frequently used in the construction
industry and the military, but it has many applications in the healthcare industry
as well. The PERT and CPM techniques are similar and thus have become merged
into a single planning strategy. The combined PERT/CPM provides managers with
a detailed, well-organized plan combined with a control-measurement process for
analyzing how well the plan is being executed. PERT/CPM is useful in planning
major projects such as building a new hospital, setting up a new healthcare insur-
ance plan, or opening a new clinic. It is also useful in smaller projects such as
planning a patient treatment or surgical procedure or installing a new magnetic
resonance imaging (MRI) machine.
Using a PERT/CPM diagram like that seen in Exhibit 11.5 allows the health-
care manager to achieve several important objectives. First, the manager gains all
the usual advantages of planning. Unforeseen events and activities can be identi-
fed, and how long something will take to do is readily estimated. Everyone in-
volved in the project has an easily understood picture that shows all the pieces of
the project, the sequence in which they are laid out and must be accomplished, the
time estimates for nishing each project step, and the total time for completing the
entire project. PERT/CPM can be used to plan any project involving lots of activi-
ties that have to be accomplished on time to meet a deadline.
PERT/CPM diagrams are simple to create. They consist of circles or bubbles
that represent completed events and arrows that represent the activities that must
be done before an event can be considered complete. The arrows connect the cir-
cles, and the arrow points to the particular event for which the activity is necessary.
288 Achieving Service Excellence
In Exhibit 11.5, for example, Event 1 must be completed before work can start on
the activity that leads to the completion of Event 2, and the same is true of Events
2 and 3. Only after Event 3 is completed can work begin on the activities leading
to Events 4, 5, and 6, which can be worked on independently of each other.
Three arrows point at Event 13, which signifes that Events 9, 10, and 12 must
be completed before Event 13 can be completed. As the diagram shows, Events 9,
10, and 12 cannot be completed before prior activities and events are frst com-
pleted. The critical paththe sequence of events that must occur on time if the
project is to be completed on timein the diagram will be explained in more de-
tail later in the chapter. It has no slack time as the other two paths do.
As an example of how the PERT/CPM approach is used, consider the HMO
plan for senior citizens that Universal HMO, Inc., wants to start in a new market.
The nal event in the sequence, the nal circle on Universals PERT/CPM dia-
gram, will be First day of HMO operation. One activity arrow leading up to that
circle might be labeled Hold three staff training sessions. But before those train-
ing sessions can be held, several other activities and events must take place: Uni-
versal HMO, Inc., must fnd a place to hold training, order training materials, hire
and prepare a trainer, and hire the new HMO personnel. Some of those activities
can be done simultaneously. Their completion might be indicated in the diagram
by a circle labeled Preparations for training sessions nished. Also included in
involving lots of activities that have to be accomplished on time to
meet a deadline.
pert/ cpm diagrams are simple to create. They consist of circles or
bubbles that represent completed events and arrows that represent the
activities that must be done before an event can be considered completed.
The arrows connect the circles, and the arrow points to the particular
event for which the activity is necessary. In Figure 11.4, Event 1 must be
completed before work can start on the activity that leads to the com-
pletion of Event 2, and the same is true of Events 2 and 3. Only after
completed Event 3 occurs can work begin on the activities leading to
Events 4, 5, and 6, which can be worked on independently of each other.
Three arrows point at Event 13, which signifies that completion of Event
13 will first require completion of activities from Events 9, 10, and 12. As
the diagram shows, Events 9, 10, and 12 cannot be completed before prior
activities and events are first completed. The critical paththe sequence
of events that must occur on time if the project is to be completed on
timein the diagram will be explained in more detail later in the chap-
ter. It has no slack as the other two paths do.
Let us leave abstract events and consider the hmo plan for senior
citizens that Universal hmo, Inc. wants to start in a new market. The
298 achi evi ng servi ce excellence
1 2 3 5 7 10 13
6 8 11 12
Figure 11.4 PERT/CPM Diagram
9 4
1 day 1 day 1 day 3 days 4 days 1 day
2 days 1 day 1 day 2 days
1 day
3 days 3 days
2 days
2 days
= Critical Path
= Activity
= Completed event
Dec. 8
Dec. 12 Dec. 17
Dec. 20
Fotter/book 8/12/02 3:47 PM Page 298
Exhibit 11.5 PERT/CPM Diagram
Chapter 11: Delivering the Service 289
the diagram are estimates of how long each activity will take. Summing the activity
times will give Universal HMO, Inc., a pretty good estimate of how long it will
take to have a trained HMO staff available.
Five steps are required to build a PERT/CPM network (Chase, Jacobs, and
Aquilano 2006):
1. Identify events and activities. The manager denes all events that must occur,
and all activities leading up to those events, for the project to be completed.
The real fruits of the planning process occur at this step. By taking the time
and making the effort, the manager can detail every activity in the project
and uncover every step that must be taken.
2. Determine the sequence of activities leading to the events. The manager
places defined activities and events in their proper sequence or the
order in which they must be done. Developing the sequence may reveal
previously undiscovered or unknown events that must be scheduled. If
you are describing how to tie a shoelace, for example, you may forget
Event 1that you must first have a shoelaceunless you take the process
step by step.
3. Estimate times. The manager estimates how much time each activity will take
so that an expected time for completing each event and the entire project
can be calculated. Managers frequently use a simple formula to arrive at a
weighted-average time estimate for each activity:
Expected time = [Optimistic time + (4 most likely time) +
Pessimistic time] / 6.
4. Create and diagram the network of activities. The manager puts all pieces
together into the total project diagram. As seen in Exhibit 11.6, each activity
and event is set out in the diagrammed network along with the expected
times.
5. Identify the critical path. The manager estimates the total time for completing
the project and identies the critical paththe sequence of activities that
leaves no slack timeby summing up the activity times across the paths
leading to the project completion. If these events do not happen on schedule,
the project will not be nished on schedule. Other paths in the network may
have a time difference between when the events must happen and when they
are scheduled to happen based on the calculation of activity times. Say, Event
6 must happen on April 28 or the entire project will get behind schedule, but
Event 6 is scheduled for completion on April 25, so the project manager has
some slack time. Even if Event 6 takes fve days to complete instead of two,
the delay will not affect the project completion date. Slack time also represents
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Figure 11.5 PERT/CPM Diagram for Starting an HMO
1
= Critical path
= Activity
= Completed event
14 13 12 11
10 9 8
7 6 5 3
4
2 1
Start Forecast
Demand
Develop
Marketing
Strategies
Finalize
Marketing
Strategies
Develop
Marketing
Materials
Print
Marketing
Materials
Enter
Participants
Information
in Database
Mail out Marketing Materials and Collect
Participant Sign-up Forms
Review
All
Systems
and
Proce-
dures
Initiate
Contact with
Providers
Review and Finalize
Contracts with
Providers
Develop
Administrative
Plan
Develop
Administrative
Procedures
Develop
and Plan Forms
and Manuals
Verify
Participant
Information
End
Feb. 20
Apr. 25
May 25 Aug. 6
Begin
Opera-
tions
Distribute Forms/
Manuals to Providers
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Exhibit 11.6 PERT/CPM Diagram for Starting an HMO
Chapter 11: Delivering the Service 291
an opportunity to shift resources and attention away from events that nish
earlier than they must and toward activities that need help.
The PERT/CPM diagram also provides a terric visual of what is involved in
the project. Using the diagram, the project manager can show everyone what the
whole project looks like, what each persons part in the project is, when each activity
needs to be done, which activities are critical, and which events precede and follow
each persons job. Even more helpful is that the manager now has a complete model
that can be used to test what might happen under a differing array of assumptions.
What will happen, for example, if some of the pessimistic time estimates come
truethat is, if whatever could go wrong, did go wrong (Prajogo 2006)?
Having the PERT/CPM diagram available also gives the manager an easy and
quick way to substitute new numbers and revise the time schedule for total project
completion if necessary. Obviously, every major project involves a lot of uncer-
tainties. With this technique, however, the manager can plug in the uncertainties
and regure their impact on the project if they should occur (Chase, Jacobs, and
Aquilano 2006).
Exhibit 11.6 represents the steps necessary to prepare for and begin offering
a new HMO plan in a specifc market. An HMO benefts manager followed the
steps in building a PERT/CPM network to determine the activities, their sequence,
and the time estimates. Then he set up the PERT/CPM diagram to show himself,
the members of his organization, and the provider with whom his organization was
contracting all the things that must happen to successfully introduce the HMO
plan to this market. This diagram serves as a daily planning guide to the benets
manager and members and providers of the organization; it can be hung on the
wall to show everyone what activities they need to accomplish each day.
A well-constructed and complete PERT/CPM diagram may be used repeatedly
because new product or service introductions generally have the same events and
follow the same sequence of activities. The same is true for building a new hospital,
planning a new clinic, or planning a particular operation in a surgical theater.
A caveat is in order, however. The PERT/CPM process assumes that the activi-
ties leading to a projects completion are independent and can be clearly dened,
but that is not always the case. The process also depends on the accuracy of the
time estimates. Because these estimates are done by fallible human beings, they
may be incorrect, and it does not take many incorrect time estimates to throw off
an entire project.
Because the activities of healthcare organizations are often sequences or pro-
cesses with a beginning and an endfrom a brief clinical encounter to cleaning
292 Achieving Service Excellence
and preparing a room for the next days patientsthe possible applications of
PERT/CPM to healthcare facilities and service situations are endless and surpris-
ingly painless.
Simulations
Making changes in the healthcare environment is often diffcult because of the
many issues that must be considered, such as cost and the effect on patient sat-
isfaction. The organization must ensure that any proposed change does not have
a negative effect. A properly run simulation enables the organization to try out
changes before implementing them, without running the risks associated with ac-
tually making the changes.
A simulation is an imitation of the real thing. It is done either through illustra-
tion on paper or a computer or through reenactments and scenario performances.
Some simulations are big, like a computerized simulation of activities in a uni-
versity health center, and some are small, like a role-playing exercise at a training
session. Some simulations involve professional actors enacting a specic healthcare
experience to show the observing employees and managers where problems can
occur in service delivery. These simulations can reveal problems employees may
not have thought about.
Simulations can also improvise patient-created problems to see if the system
has safeguards to keep the patient from failing in the experience or, if a failure
does occur, to keep the patient from irreparably harming the value and quality of
the experience. Organizations can use all types of simulations when planning the
service delivery system.
Computerized simulation techniques are the most sophisticated; they allow in-
credibly detailed simulation of the service delivery system and provide ways to
measure and manipulate the system to see what might happen under different as-
sumptions. Computers can also simulate behaviors of patients, with their innite
needs and ranges of behavior, on the receiving end of the system.
The unique challenge in patient care is that each patient is different. Because
predicting how any one patient is going to behave within the service experience is
almost impossible, the opportunities for system failures are tremendous. Simulat-
ing patient behavior allows a better comprehension of how that variability in pa-
tients affects the systems ability to deliver the service at the level expected. Across
the entire healthcare experience, simulation can identify problems created by both
the organization and the patient (Alvarez and Centeno 2000; Powers and Jack
2008; Pullman and Thompson 2003).
Chapter 11: Delivering the Service 293
A good illustration of simulation is the recent trend for large urban hospitals to
run computer simulations of their emergency departments. They gather data on
arrival patterns and healthcare needs of patients at different times and days of the
week and enter the data into the computer. The data may show that on a typical
weekend evening, patients with trauma injuries begin arriving early in the evening
and that the frequency and severity of traumas increase as the evening progresses.
The data may also show that minor problems (e.g., cuts and bruises) increase dur-
ing weekend days, when physician ofces are normally closed.
The emergency department can use the data generated by the computerized
simulation to predict the type of medical care required by time of day and day of
week and the number of staff required to serve the predicted patient population
effciently and effectively. Moreover, the hospital can estimate patient bed require-
ments, medical equipment demand, optimal stocking of supplies, and even the
number of meals consumed in the cafeteria.
Not every healthcare organization has the patient volume to justify or pay for
the creation of a full-scale computer model to study its service delivery system
in detail. Nonetheless, with the increasing availability of computer technology in
smaller, more user-friendly software packages, even individual physicians can now
economically create computerized simulations of their systems.
Already available to small healthcare organizations is the General Purpose Sim-
ulation System for Personal Computer (GPSS/PC) software. Such systems allow
organizations to simulate portions of their delivery systems or an entire delivery
system. For example, the GPSS/H simulation system allows a medical clinic to
model appointment sequencing patterns to determine what is most effective in
reducing patient waiting time, doctor idle time, and overtime without incurring
any trade-offs.
CROSS- FUNCTI ONAL ORGANI ZATI ONS
Thinking of the service delivery process as a system that requires the integrated,
coordinated activity of people who work in different departments leads to reec-
tion on how the overall organization is designed. Is it designed so that individual
departments can perform their individual functions smoothly, or is it designed so
that the overall service delivery system functions smoothly? Anyone who has ever
worked in an organization where different functional areas never communicated
with one another knows full well that the two designs are not the same.
One method of organizing people and groups to enable them to work tem-
porarily across the boundaries or functional units in which organizations are
294 Achieving Service Excellence
traditionally structured is the cross-functional structure. This term is also used
to refer to a group or project team overlaid on the traditional functional organi-
zational structure and assigned to work on a task for a limited time. Traditional
organizational forms are characterized by a single line of authority running from
top to bottom: An admissions clerk reports to a supervisor, the supervisor reports
to a manager, and so forth.
A cross-functional organization is characterized by multiple lines of authority:
An operating nurse may report to more than one person, for example. In health-
care organizations, many situations arise that call for focusing everyones clinical
skills on solving a patients problem or meeting a patients expectation right at that
moment. Examples might include a surgical team or patient safety team. Cross-
functional structures, therefore, are especially useful in the healthcare industry, and
in fact in any industry that is service driven.
Karl Albrecht (1988) tells a story about showing a group of hospital managers
how the cycle of service appears from the patients point of view. After an excited
discussion in which they dened all the tasks necessary for delivering the hospi-
tal services needed by the patient, one manager suddenly said, But no one is in
charge. In other words, because of the way the typical hospital is organized, no
one person is responsible for making sure service is smooth, seamless, and focused
on the patient. Every department and every function is someones responsibility,
but no one is responsible for ensuring that all the subservices work together for the
patients benet. This story, although 20 years old, is still relevant today. It may
explain why patients are encouraged to bring along a family member or friend to
a clinical service or visit.
In elaborating on this point, the manager stated:
Our hospital is organized and managed by professional specialtyby
functions like nursing, housekeeping, security, pharmacy, and so on.
As a result, no single person or group is really accountable for the
overall success and quality of the patients experience. The orderlies are
accountable for a part of the experience, the nurses for another, the lab
technicians for another and so on. There are a lot of people accountable
for a part of the service cycle but no one has personal accountability for
an entire cycle of service. (Albrecht 1988)
More and more hospitals believe major change is needed to provide patients
with a seamless service experience. Toward that end, many have reorganized their
healthcare delivery systems to use cross-functional teams in delivering their ser-
Chapter 11: Delivering the Service 295
vices. A cross-functional team is a group staffed by a mix of specialists (i.e., physi-
cians, nurses, nurse assistants, and so forth) formed to accomplish a specic objec-
tive. Team membership is usually assigned rather than voluntary. One example
is the formation of a safety and security committee, an approach used by Sharp
Healthcare, the 2007 Baldrige Award winner. The committee comprised members
from various clinical disciplines, and its purpose was to identify safety and security
concerns throughout the organization and to attend to them before they became
problems or caused harm.
In healthcare, many such teams have involved the use of multiskilled health
practitioners who are cross-trained to provide more than one function, often in
more than one discipline. The combined functions can be found in a broad spec-
trum of health-related jobs ranging in complexity from the nonprofessional to the
professional level and including both clinical and managerial functions. Research
indicates that cross-functional teams have been successful in lowering costs, im-
proving clinical quality, and enhancing patient satisfaction (Lemieux-Charles and
McGuire 2006).
Lemieux-Charles and McGuire (2006) reviewed the literature on healthcare
teams to determine the impact of team redesign on team effectiveness. The re-
searchers found that the type and diversity of clinical expertise involved in team
decision making largely accounts for improvements in patient care and organiza-
tional effectiveness. Collaboration, conict resolution, participation, and cohesion
are most likely to inuence staff satisfaction and perceived team effectiveness.
Healthcare organizations use project teams, matrix structures, and other cross-
functional forms. Because these forms generally involve people working under
more than one line of authority, some traditional managers who believe strict lines
of authority are important have problems working with cross-functional forms.
On the other hand, crossing functional areas and focusing everyone on the patient
can offer some important benefts. Exhibit 11.7 presents the advantages and disad-
vantages of these organizational forms.
CONCLUSI ON
Most service problems are caused by defciencies in the service delivery system
rather than individual staff members. Consequently, benchmark healthcare orga-
nizations analyze their delivery system from their customers viewpoint, starting
with their service expectations. There are many tools available for them to use to
systematically and thoroughly investigate the service delivery system.
296 Achieving Service Excellence
Healthcare organizations should use whatever organizational design best en-
ables every unit and every person to focus on the patients needs, wants, and ex-
pectations. Although the organizational chart may show functional divisions with
different people responsible for different things, such as maintenance, information
systems, accounts receivables, nursing services, and so on, everyone in these excel-
lent healthcare organizations knows that his or her real organizational function
is ensuring that the healthcare experience meets or exceeds the patients expecta-
tions.
check-in to discharge, patients are looked after by a care-pair," usu-
ally a registered nurse and a multiskilled health practitioner. The teams
are cross-trained in functions ranging from ekg monitoring to record-
ing patients' expenses. Patients' rooms have computer terminals and
mini-pharmacies so that most of what is needed is close by. This
approach minimizes idle time and cuts staff and paperwork. Time spent
with patients has increased oc percent, personnel costs have declined
c percent, and patient satisfaction has increased.
ic
The key factor in
,co achi evi ng s ervi ce excel l ence
Table 11.2 Advantages and Disadvantages of Cross-Functional Structures
Advantages
1. Create lateral communication channels that increase frequency of
communication across functional areas in the organization
2. Increase quality and quantity of information up and down the vertical
hierarchy
3. Increase flexibility in utilization of clinical expertise and capital
resources
4. Increase individual motivation, job satisfaction, commitment, and
personal development
5. Enable achievement of clinical excellence more easily
Disadvantages
1. Violate traditional single line of authority and authority must be
equal to responsibility principles of organization
2. Lead to ambiguity about control of resources, responsibility for tech-
nical issues, and human resources management issues
3. Create organizational conflict between clinical and team managers
4. Create interpersonal conflict among individuals who must work
together but have different backgrounds; clinical training; and per-
spectives on work, time horizons, and goals
5. Create loss of status, causing unit managers to think that their
autonomy has been eroded
6. More costly for organization in terms of increased overhead and staff,
more meetings, delayed decisions, and more information processing
7. More costly for individuals in terms of role ambiguity, conflict, and stress
Fotter/book 8/12/02 3:47 PM Page 306
Exhibit 11.7 Advantages and Disadvantages of Cross-Functional Structures
Chapter 11: Delivering the Service 297
Service Strategies
1. Check for system failure before blaming people.
2. Use detailed planning to prevent most service failures.
3. Plan for patient failures and how to recover from them.
4. Design the organization to ensure a seamless customer experience.
5. Use all available tools to break down the service experience into steps that
can be studied.
6. Determine the cause of a service problem.
7. Identify and eliminate current policies, procedures, and rules that may
impede customer service.
8. Train staff not to use policies, procedures, and rules as excuses for not
providing customer service.
9. Monitor and maintain the quality of the service delivery system; everyone
is responsible for avoiding service failures.
10. Design the service system so that the overall service delivery system, rather
than the individual departments, functions smoothly.
11. Designate a staff position that will be responsible for the entire cycle of
service.
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299
Hurry up and wait.
Old military saying
C H A P T E R 1 2
Waiting for Healthcare Service
Service Principle:
Manage all parts of the wait
How long people wait and how long they are willing to wait are fascinating sub-
jects. A British Airways television commercial says people typically spend about 8 1/2
weeks waiting in lines during the rst 30 years of their lives. Long waiting lists are also
a standard feature of modern life. Some parents put their children on the waiting lists
of exclusive preparatory schools before the children are even born. And if you want to
ride your own raft down the Colorado River in the Grand Canyon, rather than ride in
a concession operators raft, you will have to add your name to a waiting listat current
use levels, youll be taking your raft trip in about 14 years.
Waiting is a universal concern to all service organizations, but it can be critical in
the healthcare industry. A poorly managed queue will not only cause dissatisfaction
with the healthcare experience, but it may cause a medical catastrophe as well. Effective
management of waiting lines requires an understanding of the mechanics and the psy-
chology of creating well-designed queues. Building enough service capacity to handle
the average patient demand is not the answer. The tremendous variation in patient care
needs makes averages largely unrelated to the ebbs and ows of actual patient demand.
Healthcare managers are especially challenged by the need to balance the healthcare
organizations commitment to patient care and satisfaction with the huge costs of build-
ing and maintaining todays healthcare capacity.
In this chapter, we address the following:
The importance of the wait
Strategies for managing the reality and perception of the customers wait
300 Achieving Service Excellence
The importance of understanding the organizations capacity to meet
customer needs
The psychology of waiting and wait lines
Overall, the key to managing the patients wait effectively is to use both quanti-
tative and psychological techniques in the appropriate combination to make waits,
even long ones, acceptable to customers.
THE I MPORTANCE OF THE WAI T
Waiting time is the length of time customers wait to have their needs ad-
dressed. A closely related concept for patients is the opportunity cost of wait-
ing, that is, the time and other opportunities the customers must sacrice to
obtain needed or desired health services. Waiting is routine in the admissions
ofce, in the physicians waiting room, in examination or testing rooms, and
on telephone lines as customers attempt to schedule appointments, acquire test
results, or resolve reimbursement issues. All patients wait to receive test results
or prognoses, to be seen by a physician or nurse, and to be told what to do or
where to go.
Nobody likes to wait in line, yet almost every healthcare organization relies on
waiting lines to adjust its xed service capacity to the variable number of custom-
ers who want service. Managing the lines and how long customers have to wait
is a major concern of any healthcare service organization or system that wishes
to improve its customer satisfaction and capacity utilization levels (Wilicox et al.
2007). Research shows that managing time well is an important predictor of pa-
tient satisfaction.
For example, a study by Anderson, Camacho, and Balkrishnan (2007)
showed that the amount of time spent with a physician is a strong predictor
of patient satisfaction and can overcome patient concerns over time spent in a
waiting room. The obvious implication of this is that healthcare providers need
to manage the total time patients spend in the healthcare system. When mis-
managed time leads to physicians spending less time with each patient coupled
with those patients waiting longer in overly crowded waiting rooms, patients
become dissatised.
As a result, some healthcare organizations are beginning to look more closely
at the issue of waiting time. The National Health Service (NHS) in Great Britain,
for example, has pledged to reduce waiting times for British hospitals (Joy and
Jones 2005). Other research on the NHS examines the role of price as a method
Chapter 12: Waiting for Healthcare Service 301
for altering wait times for appointments and during the actual visit. For example,
prices could be set higher during peak periods and lower during other times to bal-
ance patient demand.
Canada has also instituted a Patient Wait Times Guarantee Trust, which prom-
ises funding for any provincial or territorial government that will implement a
wait-time guarantee for at least one procedure selected from ve priority areas:
cancer care, heart care, cataract surgery, joint replacement, and diagnostic imaging
(McMillan 2007).
In some respects waiting is an inevitable part of the healthcare experience be-
cause no organization can perfectly prepare itself to meet the needs of all custom-
ers instantly. In another respect the wait is a service failure. Even if the wait at the
physicians ofce is no surprise and therefore meets the patients expectations, the
patient still does not like it. If patients tire of waiting, and if they are not too ill
to do so, they may just leave. For a healthcare provider that operates in a com-
petitive market, this can be a serious loss of present and future patient revenues
(Weiss 2003). For a healthcare provider that faces litigation attorneys representing
patients whose overly long waits led to subsequent medical problems, this can be
a major nancial cost.
What makes patients wait? Opportunity cost is the answer. High expectations
explain the large numbers of patients willing to wait for appointments with famous
surgeons, with respected dentists, or at well-known cancer clinics. The people wait-
ing believe the quality or the uniqueness of the medical treatment will outweigh
the costs of waiting, despite the full patient schedule and the numbers on a waiting
list. In effect, each person makes an opportunity cost judgment. If the expected
benets of that particular service or treatment outweigh the costs of idly sitting in
a reception area, the patient will wait. On the other hand, in a clinic for the indi-
gent, the patients may have no opportunity costs to waiting as they have no other
choice but to wait.
Waiting time is an unfortunate but expected part of the service process in
healthcare. As a result, receiving patient service on time is rare. In spite of the
pervasive use of appointments to balance healthcare capacity with patient demand,
being served on time is an infrequent event. Even more frustrating to patients is
the fact that although their time is respected in most other services, waits seem in-
creasingly to be the rule and not the exception in healthcare. Even staff may begin
to believe long waits are normal and to be expected and that customers should
tolerate them.
Stephanie Sherman (1999) identied four primary reasons patients and physi-
cians leave a healthcare organization; the most important is that waiting times are
too long. Since Shermans study, more research has shown that waiting continues
302 Achieving Service Excellence
to be a major source of patient dissatisfaction (e.g., Hill and Joonas 2005). Todays
busy consumers demand and expect prompt service. When a customer defects be-
cause that expectation is not met, the healthcare organization may lose the revenue
that customer represents for a lifetime. Even worse, further revenue may be lost
from negative word of mouth, as each dissatised customer will tell others to avoid
using that provider.
Emergency Department Waits
Emergency department (ED) patients are waiting even longer now to see a doctor,
a potentially dangerous development as rising numbers of underinsured and unin-
sured Americans turn to EDs for medical care (Francis 2008). The median wait for
adults rose from 22 minutes in 1997 to 30 minutes in 2004. Heart attack victims
had a median wait time of 20 minutes in 2004, up 150 percent from 8 minutes in
1997. Black, Hispanic, and urban patients spend more time in waiting rooms than
rural and white patients. An increase in the number of ED visits plus a decline in
the number of EDs has contributed to the increased wait (Healthcare Financial
Management 2008; Wilper et al. 2008).
Physician Waits
Press Ganey Associates, a healthcare consulting rm, reviewed more than 1.5 mil-
lion patient surveys in 1,500 acute care hospitals across the country to determine
patient satisfaction with waits. It found that patient satisfaction scores drop sig-
nicantly with the amount of time spent in the ED, from 89.3 when patients
are seen in under one hour to 77.7 when they have to wait more than four hours
(Press Ganey 2007a). These data are supported by another Press Ganey report on
individual physicians that shows a signicant decline in patient satisfaction as both
time spent waiting in the physicians ofce and in the exam room increases (Press
Ganey 2007b).
A 1997 study by Press Ganey evaluated 25 physician practice qualities in terms
of their relative need for improvement. Seven of the top ten areas identied as
needing improvement were related to customer waiting. These ndings are still
relevant today:
1. Availability of doctor on phone
2. How promptly phone call was returned
Chapter 12: Waiting for Healthcare Service 303
3. Lack of phone access to service
4. Speed of the registration process
5. Ease of obtaining a desired date and time for appointment
6. Length of wait in the reception area
7. Waiting time to see the doctor
A 2007 Web-based cross-sectional survey of 5,030 patients who rated their
physician found that longer waiting times were associated with lower levels of pa-
tient satisfaction (Anderson, Camacho, and Balkrishnan 2007). However, length
of time spent with the physician was the strongest predictor of patient satisfaction.
The decrease in satisfaction associated with long waiting times was substantially
reduced if the physician spent ve minutes or more with the patient. Alternatively,
if the long wait was combined with a short physician visit, the negative impact of
the long wait was increased.
An earlier study by Dansky and Miles (1997) found that the total time waiting
for a physician was the most signicant predictor of patient satisfaction; however,
informing patients of how long their wait would be and making sure they were
pleasantly occupied during the wait were also signicant predictors of patient satis-
faction. These results suggest that even if waiting times cannot be shortened, they
may be managed more effectively to improve patient satisfaction. Letting patients
know their expected waiting time enhances patient satisfaction (Anderson, Cama-
cho, and Balkrishnan 2007).
Appointment/Treatment Waits
Reducing patient waiting times for appointments can have a signicant impact
on enhancing patient outcomes. Williams, Latta, and Conversano (2008) note
that timely access to mental health services is critical to successful treatment of
adults with severe and persistent mental illness. Waiting for weeks for a psy-
chiatric appointment increases psychiatric hospitalizations and risk of suicide.
However, many administrators of community mental health clinics assume that
waiting for services is inevitable given the high demand. The study by Williams,
Latta, and Conversano (2008) found that systematic changes in the service deliv-
ery system reduced wait times for a psychiatric appointment, the no-show rate,
and psychiatric hospitalizations; these changes also improved staff morale and
teamwork. These outcomes can be successfully achieved in settings other than
the mental health eld.
304 Achieving Service Excellence
CAPACI TY AND PSYCHOLOGY
Managing the wait has two major components. First, ensure that the appropriate
capacity has been built into the service facility to minimize the wait for the antici-
pated number of customers arriving at the anticipated rate. Second, ensure that the
waiting customers psychological needs and expectations are met while they wait.
The capacity decision results from careful study of the expected demand pat-
tern. Whether one is trying to determine how many copier machines to buy to
serve a medical records department, how many treatment rooms to build in the
ED, how many phone lines to run into the hotline for an AIDS (acquired immu-
nodeciency syndrome) counseling center, or how many beds to add to a hospital,
the need to make an accurate capacity estimate is the same. Management must
predict and attempt to manage the three factors that drive the capacity decision:
How many people will arrive for the service,
The rate at which people will arrive, and
How long the service will take.
The capacity decision would be easy to make if the same number of people ar-
rived for service each day, their arrivals were evenly spaced throughout the day, and
serving each person took the same length of time. For example, a psychiatrist can
plan to see eight patients per day, schedule them to arrive on the hour, serve each
patient for 45 minutes, and use the remaining 15 minutes to write up notes on that
patient and prepare for the next. That psychiatrist has an easy capacity decision:
one service facility (an ofce) with one chair for the psychiatrist and one couch for
the patient.
If the service is an ED, however, the healthcare provider knows approximately
how long each type of treatment will take, but the management has to predict
how many people will arrive for service at different times throughout each day of
each week and what types of treatment they will need. For example, in Daytona,
Florida, ED arrivals will be different in timing and type of injury during Bike
Week than during the Daytona 500. Furthermore, if the service has a less denite
beginning and ending time, like some types of hospital stays, both the average time
taken to deliver the service and the number of persons arriving for service will have
to be estimated or predicted. Several methods for making these predictions will be
discussed later in this chapter.
Capacity designs can also affect perceptions of service quality. A doctors wait-
ing area that has too many seats will appear empty to patients. The scarcity of other
patients may lead those who did come in and sit down to conclude that the clinical
Chapter 12: Waiting for Healthcare Service 305
quality or medical expertise is not up to par. This assumption predisposes patients
to expect a less-than-superb medical experience. Furthermore, they may feel fool-
ish for choosing a doctor who is so obviously unpopular. The physician has two
strikes against her, just because the ofce designer put in too many seats. From the
physicians point of view, the excess capacity also has a serious disadvantage: it costs
money! Unused chairs, extra space, and empty coat racks represent capital that pre-
sumably could have been better spent elsewhere. Excess capacity may result in extra
personnel costs as well. On the other hand, too few seats can convey a totally differ-
ent message: The doctor does not care about the patients and is disorganized.
In an ideal world, healthcare organizations will have the exact clinical staff and
physical capacity required to serve each patient immediately. Consider a hospital
ED where each patient arrives just when medical staff and equipment are available
to provide the desired treatment. Patients want that kind of service, and organiza-
tions want to provide it. Both are frequently disappointed, however.
Organizational Options
Because people do not arrive at service facilities in neat, ordered patterns, they
sometimes have to wait for service. When the organization sees that its waits for
service are becoming unacceptably long, healthcare managers face several choices
(Heskett, Sasser, and Hart 1990; Kreindler 2008).
Refuse to Serve Additional Customers
This choice is highly undesirable; after all, healthcare organizations exist to provide
service. But sometimes prospective patients must be told, We do not have any
appointments available until next fall, or You will have to seek care at another
facility.
Add Capacity
Because this alternative is usually expensive, organizations do not choose it un-
less they believe the high demand will continue to cause long waits. Of course,
certicate-of-need laws in various states also constrain if and when capacity can be
added. The organization will be particularly hesitant to add capacity if the capacity
of its design day (a design day is a theoretical service day, and capacity is designed
for the number of patients seen on that day) is set at a high level.
Stop-gap measures for adding capacity temporarily are sometimes available:
Employees can be asked to work overtime; a team approach can be used to reassign
employees from their normal areas to help unclog a service bottleneck; temporary
306 Achieving Service Excellence
help can be hired; physical facilities, like trailers or portable buildings, can be
rented; and so forth.
Manage Demand
Simply informing customers about busy and slack times may smooth out demand.
Rather than being open to all patients at any time, healthcare providers typically
use appointments to smooth out ebbs and ows of patient demand. Some pro-
viders offer inducements to encourage use of capacity at nonpeak demand times.
Early-bird specials and discounts for off-peak use of wellness centers and health
clubs are some examples.
Reservations or appointments are useful and help balance capacity utilization
when staff and equipment are too expensive to sit idle, such as at hospitals, dental
ofces, and magnetic resonance imaging (MRI) clinics. Most healthcare organiza-
tions have the market stature to insist that their patients make appointments, and
the opportunity cost to the patient for not receiving the specic service at the spe-
cic time from the specic provider is usually so great that the patient is willing to
make an appointment. When the cancer specialist is the only one in the city able
to treat a certain rare form of the disease, or the heart surgeon is the only one you
trust to do the bypass, or you love the physician who has treated your family for 40
years, you will make an appointment and thereby help the provider organization
efciently manage its capacity.
Another way to manage demand is by shifting demand. A good example is
shifting elective surgeries from weekday mornings to weekends. An obstetrician
will frequently estimate the due dates of patients who are expected to have a typical
delivery and then schedule cesarean sections around those times. This shifting of
demand for obstetrical services allows the doctors time and the hospitals surgi-
cal capacity to be more efciently used. Although such events cannot be perfectly
planned, this type of demand shift allows far better utilization of obstetrical ser-
vices than would otherwise be possible.
LaGanga and Lawrence (2007) borrow an idea from the airline industry to
manage demand. They suggest overbooking as a way to ensure that the existing
capacity is fully used even though it may lead to longer waits when more than the
estimated number of patients actually arrive. As with the airlines, overbooking has
a downside; on the other hand, every healthcare provider should have a historical
record of the percentage of patients that actually show up for appointments. This
historical record should allow a fairly close estimate of how much overbooking can
be done without distracting patient care or causing dissatisfaction.
Triage is often used to address excess demand. Under triage, to ensure that the
most serious medical problems are treated rst, patients are divided into three
Chapter 12: Waiting for Healthcare Service 307
groups: (1) those who must be helped now, (2) those who can be helped later, and
(3) those who cannot be helped at all, which is rare.
Some EDs and clinics have taken this concept to the next level. They have
established fast-track systems that put patients with routine or noncritical health-
care problems in a separate queue. Instead of using the more expensive doctors,
this queue may use paraprofessionals, lower-skilled nurses, and low-tech treatment
rooms. The fast-track queue reduces the cost of treatment and increases the speed
at which both lower-level and more acute medical needs are met. Following are
other examples of triage:
St. Joseph Hospital in Orange County, California, implemented an ED
program called Rapid Assessment and Discharge in Triage (RADIT) to reduce
patient waiting time and improve patient satisfaction. A roving RADIT
team serves ED visitors who have nonurgent problems. After 6 months of
this practice, ED patients were discharged in 97 minutes, on average, and 96
percent of RADIT patients rated the quality of service received as either good
or excellent (Vega and McGuire 2007).
Ruohonen, Neittaanmaki, and Teittinen (2006) present a simulated triage
model developed for a hospital in Finland. The model tests different process
scenarios, allocates resources, and performs activity-based cost analysistasks
that when performed appropriately can result in operational efciencies
and thus higher patient satisfaction rates. Efciency at this Finnish hospital
increased by more than 25 percent (Ruohonen, Neittaanmaki, and Teittinen
2006).
Despite efforts to match supply with demand or to make the waiting experience
as entertaining and comfortable as possible, the long waits can still be a concern to
both the organization and the customer (Dickson, Ford, and Laval 2005). This is
especially true where waits can have far-reaching effects on the organizations abil-
ity to meet its customers expectations. (See Sidebar A for a virtual wait manage-
ment strategy used outside the industry but is now being adopted in healthcare.)
Divert Patients While They Wait
At a minimum, waiting patients should be offered something else to do. The tradi-
tional diversion in a healthcare ofce is a stack of magazines or newspapers, though
some organizations also provide television, instructional videos or videos that fea-
ture additional services available, aquariums, toys, crossword puzzle books, and
computer games. Today, some freestanding retail medical clinics hand out beepers,
similar to those used at chain restaurants, to give their waiting patients freedom
308 Achieving Service Excellence
to move about the surrounding areas without losing their turn in line (Lethlean
2009). To give customers someplace to go and something to do while they wait,
some hospitals have expanded their gift shops.
Improve Waiting Areas
Uncomfortable waiting areas can make a moderate wait seem excessively long.
Many healthcare organizations give low priority to the quality of their waiting
SIDEBAR A: THE VIRTUAL WAIT STRATEGY
At Disney, despite innovative efforts to reduce
wait times, the long lines at the most popular
attractions continued to be a major dissatiser
with guests. The availability of new technolo-
gies led Walt Disney World to develop the vir-
tual queue concept. Instead of standing in line,
guests would enter a virtual queue by registering
their place in line with a computer and letting
the computer save their place. Then, when the
guests reached the front of the virtual line, they
would be notied to return to the line and imme-
diately enter the attraction.
The system is called Fastpass, and as a re-
sult of overwhelming guest response, it was ex-
panded to all the Disney parks worldwide and
is now used by more than 50 million guests per
year. The system works as follows. When guests
approach a Fastpass attraction, they insert their
park admission ticket into a Fastpass turnstile,
which places them in a virtual queue. Based on
how many guests are in the virtual queue and
the current processing capacity of the attrac-
tion, the computer estimates how long it will
take for guests to reach the front of the line. This
estimated time becomes their designated return
time and is automatically printed on their Fast-
pass ticket. To provide guests with plenty of ex-
ibility, they are assigned a 60-minute window of
time during which they can return and enter the
attraction with little or no wait. This 60-minute
window was deemed necessary to provide guests
with plenty of time to visit another attraction
without having to worry about getting back late
and missing their assigned time.
The virtual queue system provides many sec-
ondary benets. Previously, during peak days
many guests spent as much as three to four hours
a day waiting in line for the most popular attrac-
tions, which severely limited the total number of
attractions they could see. The use of Fastpass
not only allowed guests to see more attractions
during the day but also greatly increased the use
of the parks secondary attractions. Another ben-
et was that guests used some of their freed up
time to engage in other revenue-producing ac-
tivities, such as dining and shopping. This pro-
vides signicant benets to guests and to Disney.
Lower perceived wait times have led to higher
customer satisfaction levels, and Disney ofcials
have seen increased spending on food and mer-
chandise per person in the parks (Dickson, Ford,
and Laval 2005).
The virtual queue strategy is an innovative way
of making the waiting line invisible. With heavy
reliance on word-of-mouth advertising and repeat
business, hospitals and healthcare organizations
cannot afford to develop a reputation for long
waiting lines and dissatised customers. But now
virtual queues provide an exciting new strategy for
creating satised customers in waiting line situ-
ations. The challenge that remains is to extend
the virtual queue concept to any service settings
where waiting lines cause customer dissatisfac-
tion. Halifax Health Medical Center in Daytona
Beach, Florida, has already adopted this strategy.
Chapter 12: Waiting for Healthcare Service 309
areas. Some still use plastic chairs with hard bucket seats connected by a steel rod.
Seating with sufcient personal space, attractive designs, and some padding can
make the wait more tolerable. Similarly, attractive colors and noise-dampening
rugs and drapes can make a difference in how patients see the quality and value
of the heathcare experience. If a wait is also uncomfortable because the ofce or
examining room is too hot or too cold, too noisy or too quiet, too dark or too
light, too open or too closed, too busily patterned or too bland, or too smelly, the
patients notice and nd their waits less tolerable. Healthcare organizations should
nd the ideal balance for each of these factors as they are important to patients.
Create and Implement Wait-Time Standards
An efciently operating registration process should require only three to ve min-
utes of patient time and should be conducted upon the arrival of each patient with
no waiting. Ofce staff should return phone calls in 20 minutes or less, and physi-
cians should return theirs in an hour. Physicians involved in surgery or emergency
care may not always be able to meet this standard, but designated ofce staff can
return the call for the physician to keep the communication channels open. Cell
phones and e-mail make these performance standards easier to achieve. Staff should
not only inform customers that service will be delayed but should also explain why
the delay is occurring. E-mailed updates are also useful, and a website that allows
patients to see where they are in a queue also makes the situation better.
Sherman (1999) says no healthcare customer should wait more than 15
minutes for anything without receiving an explanation for the delay, includ-
ing an apology and an estimate of how long the customer will have to wait to
receive the service. Apologies are always a welcome and often surprising op-
tion. When delays exceed or are predicted to exceed one hour, the option to
reschedule the appointment should be offered, as should paid transportation, if
needed. Exhibit 12.1 indicates a possible format for collecting data on patient
waiting time.
To correct unacceptable waiting times, an organization should look rst at
the service delivery system (discussed in Chapter 11). Do patients wait for staff,
equipment, test results, or some other reason? Systematically record how long all
customers wait and what they are waiting for and periodically summarize these
reports, disseminate the information to staff, and use it as a basis for staff dis-
cussions about reducing waiting time through system adjustments. The reports
can even be used as metrics for performance improvement goals. The American
Academy of Family Physicians and the American College of Physicians offer
technical help for organizations seeking ways to better schedule patient ow and
manage patient time.
310 Achieving Service Excellence
A second strategy is to focus staff attention on the consequences of waiting. Evi-
dence indicates that reducing waits increases customer service, so allowing employ-
ees to see the actual wait times experienced by their patients and combining that
with performance goal setting may be a powerful motivator to improve wait times.
A study by Slowiak, Huitema, and Dickinson (2008) found that setting goals and
giving employee feedback reduced wait times in a pharmacy by 20 percent and
signicantly improved customer satisfaction.
Calculate and Use the Design Day
Whether they realize it or not, or whether they do it consciously or not, all health-
care organizations use the design-day concept. Design-day capacity is a manage-
ment decision that determines how much capacity will be provided to handle a
predetermined amount of demand without compromising the healthcare expe-
wai t i ng f or heal t hcar e s ervi ce ,i;
Table 12.1 Patient Record Data for Tracking Patient Waiting Times
Patient Names
Jane Doe Harry Smith
9 0 / 3 2 / 2 9 0 / 3 2 / 2 e t a D
Time of appointment 9:00 a.m. 2:30 p.m.
. m . p 5 3 : 2 . m . a 5 5 : 8 l a v i r r a f o e m i T
. m . p 5 3 : 2 . m . a 0 0 : 9 n i - n g i s f o e m i T
Registration completed 9:05 a.m. 2:39 p.m.
Times of communication regarding appointment
Time of exam-room entry 9:27 a.m. 2:50 p.m.
First 9:10 a.m.
Second 9:22 a.m.
Third
Time of first contact with clinician 9:32 a.m. 3:08 p.m.
Time of last contact with clinician 9:47 a.m. 3:17 p.m.
Time of checkout 9:50 a.m. 3:25 p.m.
. m . p 2 3 : 3 . m . a 4 5 : 9 e r u t r a p e d f o e m i T
T s e t u n i m 7 5 s e t u n i m 9 5 e m i t d e s p a l e l a t o
s e t u n i m 9 s e t u n i m 5 1 e c i v r e S
W s e t u n i m 8 4 s e t u n i m 4 4 g n i t i a
Did the patient receive timely communication about delays? Yes No
Fotter/book 8/12/02 3:47 PM Page 317
Exhibit 12.1 Patient Record Data for Tracking Patient Waiting Times
Chapter 12: Waiting for Healthcare Service 311
rience. If demand is less than the design-day model, customers are satised but
the facility and staff are underutilized. If demand exceeds the design-day capacity,
some customers will be dissatised. Waiting lines may form on design days, but
they will not be so long that customers perceive a decline in the quality or value of
their healthcare experience.
Benchmark organizations know just how long waits can be and still remain
within limits acceptable to patients. An ED, a walk-in clinic, a pharmacy, or an
individual physicians practice might use a 15-minute maximum wait for any one
part of the healthcare experience as its criterion. On the design day, the provider
does not want anyone to wait longer than this maximum time because surveys have
shown that customer perceptions of quality and value decline sharply with longer
waits, and longer waits increase the likelihood that the patient will leave. Although
15 minutes is the maximum wait deemed acceptable in the design-day decision,
seeing the physician, receiving lab results, or seeing a nurse can take longer than
planned. However, based on the accumulated data, a design day that targets a 15-
minute maximum wait may be the best balance between the costs of having too
much capacity and the patient dissatisfaction of not having enough.
A truly patient-focused healthcare provider may set its design day at a very
high level, say 80 to 90 percentthat is, supply will be adequate for demand on
80 to 90 percent of the days of the yearbecause it appreciates the fact that most
patients have only limited time in which to get the necessary treatment and may
have other healthcare provider choices besides waiting. A patient with a broken
hip cannot wait four weeks for treatment and expect a good medical outcome, so
the design-day level for the hospital orthopedic facility must be set at a higher level
than, say, for the pharmacy. The same may be true for the ED because many ED
patients must be treated quickly.
To provide a healthcare experience of high quality, the organization may set its
design day high and build more capacity than might otherwise be practical. The
cost of an unhappy or an untreated customer to a major clinic that relies on return
visits must be carefully balanced against the costs of building capacity. Similarly,
not having adequate capacity to serve the needs of the medical staff (another type
of customer) or patient families (another type of customer) will lead to dissatised
physicians and families looking elsewhere for care.
Calculate and Use the Capacity Day
Many organizations calculate and use a capacity day, which is the maximum num-
ber of customers allowed in a facility in a day or at one time. This number may be
set by the re marshal, based on accreditation standards, or based on the number of
square feet each patient must have available. The state of California, for example,
312 Achieving Service Excellence
currently regulates minimum nurse stafng ratios in healthcare facilities, which
constrains managements exibility to modify the capacity day to reect uctua-
tions in patient demand. Typically, however, the capacity day is set by the organiza-
tion to represent a point beyond which overall patient or physician dissatisfaction
with waits or delays in service is unacceptable.
Do Nothing
The organization can accept the fact that waits will lead to unhappy patients and
hope they are not so unhappy that they vow never to return or are unable to nd
any alternatives so that they have no choice but to return when they need that or-
ganizations medical service. Although there are hospitals located in remote areas,
free clinics, or highly regarded medical providers that are so good they can be indif-
ferent to waits, this alternative is becoming less and less desirable in this increasingly
competitive world with increasing numbers of healthcare options.
Choosing a Strategy
Organizations can use all of these options in some combination. For example, an
ED might decide to turn patients away (if legally permitted), limit usage by divert-
ing patients to other hospitals, build a new facility, expand present capacity, have
an on-call staff group that can be summoned when needed, provide diversions for
waiting patients with nonemergency needs, improve waiting areas, minimize waits,
communicate regularly concerning the reasons for waits, or simply accept higher
levels of customer dissatisfaction. Good customer satisfaction research can identify
the best strategy. The goal is to nd the strategy that ensures the greatest customer
satisfaction with the lowest capital and stafng costs and allows both customers
and the organization to satisfy their needs.
Baptist Health Care, for example, focused on reducing patient waiting time as
part of its customer service program. Lower wait-time standards were established,
records were kept for all patients, staff members were held accountable, and sev-
eral other wait-reduction strategies were implemented. As a result, patient satisfac-
tion scores increased signicantly over time and the percentage of patients waiting
more than two hours for service or leaving without treatment declined signicantly
(Studer 2008).
MANAGI NG THE REALI TY OF THE WAI T
Few organizations in any industry have the luxury of adjusting capacity quickly or
managing demand by getting customers to show up when the organization wants
Chapter 12: Waiting for Healthcare Service 313
them to instead of when customers want or need to come. Like organizations in
other industries, most healthcare organizations must rely on predicting and man-
aging the inevitable waits that are created when patients arrive seeking treatment.
The dilemma for the organization is that although adding staff or capacity costs
more, it reduces the wait, which improves the patient-experience quality, patient
satisfaction, and patient loyalty. On the other hand, reducing staff saves money but
increases the wait, which decreases patient-experience quality, patient satisfaction,
and patient loyalty.
How can a healthcare organization nd the proper costbenet balance? The
place to begin is using queuing theory, sometimes called waiting-line theory, and
the mathematical solutions this technique offers (VanBerkel and Blake 2007).
Queuing or Waiting-Line Theory
A typical queuing-theory problem might be the following: If an average of ve
patients per hour arrive at an ED or a public health clinic with a single service
provider, and if it takes the service provider an average of nine minutes to treat
or attend to a patient, how long does the average patient wait? During an average
hour, how many minutes will the service provider be treating patients and how
many minutes will the provider be idle?
Most applications of waiting-line theory in the healthcare industry are based
on the idea that people who cannot otherwise be scheduled do not arrive in neat
patterns. The typical approach is to sample the arrival and the service requirement
patterns of patients and use this information to simulate the distribution that best
matches the reality for the particular organizations patients. Large clinics or EDs
should actually count all of its patients over a period of time, or sample them over a
longer period using some appropriate sampling methodology, and let the actual pa-
tient patterns represent the distribution of arrival rates and service requirements.
All healthcare providers, regardless of size, should collect these data as well as
they can. In this era of inexpensive computer power and software, it should be rela-
tively simple to collect and analyze arrival patterns (as illustrated in Exhibit 12.1)
at any physicians ofce, walk-in clinic, or pharmacy.
All waiting lines have three characteristics that any model must include:
1. Arrival pattern is the number of patients arriving and the manner in which
they are entering the waiting line. Arrivals can be scheduled, random (e.g.,
any patients entering an ED), in bulk (e.g., patients arriving after a natural
disaster), or in some other distribution that is difcult to describe (e.g.,
314 Achieving Service Excellence
patients coming in irregular intervals). Queue management is easiest when
patient arrivals can be scheduled. Even if arrivals cannot be strictly scheduled,
however, they can sometimes be controlled. For example, a dentist can set
aside the rst hour of each morning for all dental emergencies. If none show
up, the dentist can focus on other practice-related tasks or paperwork.
2. Queue discipline is the manner in which arriving patients are served. Options
are rst-come, rst-served; last-come, rst-served; or some other set of service
rules, such as severity of need. On the battleeld or in the ED, for example,
the triage principle is often used. As another example, patients waiting to have
their teeth cleaned will not usually object if a patient entering the dentists
ofce with a painfully swollen jaw is attended to rst. Patients understand
service rules based on need; they do not understand an implicit rule such as
Answer a phone call before serving the client or patient standing right in
front of you.
3. Time for service is the amount of time to serve patients. The time boundaries
of some healthcare services can be carefully managed, like an MRI or the
time spent in the recovery room after a routine appendectomy, but the time
required for many services is unpredictable. Some ED patients may suffer
from severe wounds, while others may have trivial problems. Some patients
want to be treated and then sent home, and others want lots of attention with
a u shot. The amount of time it takes to serve the needs of different patients
is as unpredictable as the patients themselves. If the waiting-line model is
going to be an aid in managing the wait, it must take this variation into
account. Waiting-line theory can be applied to anything that waits in line for
something to be done to it. An insurance report waiting to be properly led
or a meal waiting to be served is as queued up and in need of managing as the
arriving customer at the ED reception desk.
Types of Queues
The rst type of queue is the single-channel, single-phase queue (note: In the fol-
lowing discussion, channel refers to a service provider, and phase refers to a
step in the service experience once it is underway)one service provider, one step.
This queue type is represented in the top illustration in Exhibit 12.2. For example,
in a small clinic, a single physician practitioner provides single-phase service to pa-
tients, who come in, wait their turn, get treatment, and leave. In a larger, busier set-
ting, patients might stand in any one of several single-channel, single-phase queues
Chapter 12: Waiting for Healthcare Service 315
,:: achi evi ng s ervi ce excel l ence
Figure 12.1 Basic Queue Types
Arrivals
Service
facility
Departures
after service
Single channel, single phase
Queue
Arrivals Departures
after service
Single channel, multiphase
Queue
Type 1
service
facility
Queue
Type 2
service
facility
Arrivals
Departures
after service
Multichannel, single phase
Queue
Service
facility
2
Service
facility
1
Service
facility
3
Arrivals
Departures
after service
Multichannel, multiphase
Type 1
service
facility
1
Type 1
service
facility
2
Queue Queue
Type 2
service
facility
1
Type 2
service
facility
2
Fotter/book 8/12/02 3:47 PM Page 322
Exhibit 12.2 Basic Queue Types
316 Achieving Service Excellence
to get a u shot. The patient looks the lines over, chooses one, stands in it to wait
for service, and eventually reaches the clinician who gives the shot. Highway toll
plazas and McDonalds counters are examples of multiple servers at single-channel
queues, but they still represent single-channel, single-phase queues because only
one person can be served at a time.
The second type is the single-channel, multiphase queuefor example, a cafe-
teria line or a medical clinic. Essentially, this type is two or more single-channel,
single-phase queues in sequence. The patient waits in one queue for service from a
single service provider, then moves on to wait in another queue for another phase
of service from another single service provider. At a typical clinic, patients queue
up for the various phases. A patient requiring treatment may go to x-ray, then to
hematology for a blood sample, and then to a waiting room for the physician.
The third type is the multichannel, single-phase queue in which the patient
begins in a single line that then feeds into multiple channels or stations for service,
each of which is staffed by a service provider. The patient waits to get to the front
of the single line, then goes to the next available channel (service provider) for
service. An example is an outpatient lab where everyone waits in a single queue.
The queue discipline is to tell the next person in line to come to the next available
phlebotomist, who in turn renders a single service (drawing a blood sample) in a
single phase.
The Federal Personnel Ofce uses this method for incoming telephone calls.
The automated system tells each caller how many callers are ahead, so the caller
can decide whether to wait or call back later. The single phase of service is to have a
phone call answered. The multiple channels for obtaining this service are the many
operators handling calls. The queue is managed by having the next available opera-
tor handle the next caller waiting in line.
Many healthcare organizations nd this method the most efcient way to man-
age their lines as it accounts well for the varying lengths of time it takes to serve
different patients. Everyone has had the experience of choosing to stand in one of
several available single-channel lines (at the movie theater refreshment stand or the
hotel front desk, for example), only to watch all the other lines move much more
quickly. The use of a multichannel, single-phase system eliminates this feeling of
inequity or bad luck; everyone starts out in the same line.
The last type is the multichannel, multiphase queue system, which is the most
complicated to manage. Essentially, it is two or more single-channel, single-phase
queues in sequence, which is similar to the current check-in process at U.S. air-
ports. The customer waits to get to the front of one line (check in), and then goes
to the next available service provider. After receiving the rst phase of service, the
customer then gets in another line (security), waits to arrive at the front, and then
Chapter 12: Waiting for Healthcare Service 317
goes to the next available service provider/channel to receive the next phase of
service. In healthcare, a patient may wait in line to see the rst available doctor of
several on duty. Then the doctor may refer the patient to a lab where the patient
waits in line to see the rst available lab technician of several on duty.
A healthcare organization will often have numerous queues linked together
in various combinations. For example, at a busy government clinic, patients may
queue up outside the building before it opens in the morning, queue up at the
cashiers ofce to pay a fee and take a number for consultation with a physician,
queue up again in a waiting area for consultation, get in another queue for a spe-
cic diagnostic or treatment procedure, and then enter a nal queue at the phar-
macy if medication is needed.
Managing the wait times associated with single and multiple channels and
phases is difcult, but it is critical for ensuring a satisfactory healthcare experience
and maximizing the providers capacity utilization.
Common sense suggests that the best queue type for an organization to use
is the one that enables customers to begin receiving service as rapidly as possible.
In actuality, the best queue type is the one that best meets patient needs, wants,
and expectations. For example, they may prefer to stand in a certain type of line
because they think they will be served faster, even if they will not in actuality. For
these reasons, organizations must know not only what queue types are most ef-
cient and cost effective but also which queues their customers prefer.
Simulation of Queues
Although a statistical distribution can be used to describe the arrival and service
patterns of many standard queues, some situations cannot be described by any
statistical distribution; only a simulation will yield the quality of data needed to
explain and predict the reality of a particular queue. Here is how a simulation
might work.
Take, for example, Aides, an extremely successful crisis help line for patients
with AIDS. Aides has 20 telephone lines that, if fully staffed, require one person
at each line (for a total of 20 people). If on an average day only 50 patients call in,
then full stafng of all the lines is an obvious waste of money because the prob-
ability of more than 20 people calling at the same time is small. But if Aides opens
only one phone line, most callers will hear a busy signal or be put on hold; they
may get no counseling or help but will experience considerable frustration. What
stafng level best balances the cost of stafng the phone lines against the cost of
frustrated or lost patients?
318 Achieving Service Excellence
Over several weeks the oor manager can monitor and record the ow of calls
and length of time callers are on a line plus how many times callers receive a busy
signal and hang up or are put on hold. If sufcient observations are made, the man-
ager can create distributions that accurately approximate the number of callers, the
arrival patterns of their calls, and the time spent asking questions or seeking help.
With this information the manager can then simulate the telephone experiences of
Aides clients to determine how to staff the phone lines appropriately at different
times and on different days of the week. Following is a simple illustration of how
that might be done.
In his ofce, the manager can conduct a Monte Carlo simulation by setting up
two roulette wheels that appear in Exhibit 12.3. Spaces are allocated on the rst
wheel to represent, in percentage form, the time between calls. From the observa-
tions already made, the manager knows that 15 percent of the time there was no
time (zero minutes) between callsthat is, calls arrived simultaneously. The time
between calls was one minute 20 percent of the time, two minutes 25 percent of
the time, three minutes 10 percent of the time, four minutes 10 percent of the
time, ve minutes 12 percent of the time, and six minutes 8 percent of the time.
Spaces on the wheel are allocated to reect these percentages. To simulate the ar-
rival patterns of the phone calls, the manager merely spins the wheel and writes on
a chart the arrival time noted in the section of the wheel when it stopped.
The second wheel in Exhibit 12.3 is, in similar fashion, portioned off to repre-
sent the observations about how long each caller was on the phone. This total in-
cludes the time to answer the call, diagnose the situation, and either refer the caller
to some specialized service or listen to and counsel the caller. Because callers vary in
their needs and desires, the time for service and the proportions on the wheel rep-
resenting those times likewise vary. The observations might reveal that 5 percent of
calls take one minute; 15 percent take two minutes; 20 percent take three minutes,
25 percent take four minutes, 15 percent take ve minutes, 10 percent take six
minutes, 5 percent take seven minutes, and 5 percent take eight minutes.
Now the manager can simulate phone demand by spinning the rst wheel to
randomly determine the time between customer calls and spinning the second
wheel to determine how long each customer takes to be served once the phone is
answered. By recording the numbers on a simple chart that notes the time between
call arrivals, times for service, and the time callers were waiting, the entire days
activities can be simulated to determine the maximum, minimum, and average
length of time callers waited for service plus the total waiting time for all callers.
The chart simulates a days activities by beginning when the phone lines open
and recording the calls throughout the day until the phone center closes. Running
this simulation many times (typically more than 100 on a computerized model)
allows Aidess management to draw some statistical conclusions about the length
Chapter 12: Waiting for Healthcare Service 319
of waiting time, counseling capacity utilization, and impact on waiting (and cus-
tomer perception of the quality and value of the experience) that opening up more
phone lines presents.
Although this is a fairly simple illustration, it shows the usefulness of mathemat-
ically determining the relationship between the service providers capacity and the
average waiting time for customers in a way that allows the healthcare organization
to nd the ideal balance between the two. This same technique can be used to de-
termine the ideal number of monorails in a theme park, toll booths on a turnpike,
beds on a hospital oor, servers and cooks in a restaurant, spaces in a parking lot,
nurses in an ED, or any other application where an organization needs to balance
the costs of providing capacity with the quality of the service experience.
Certain basic forces affect waiting lines, and they can be expressed mathemati-
cally. An explanation of the mathematics of waiting lines appears in Sidebar B.
Balancing Capacity and Demand
Determining the proper balance between supply and demand requires more than
basic calculations. The AIDS hotline in the previous example has to gather more
data about caller behaviors and expectations. If, say, management nds that clients
hang up if they are put on hold for more than one minute, then a wait longer than
one minute is unacceptable no matter what the remaining data might reveal. On
the other hand, if the results show that callers are willing to wait because the help
for all callers. The chart simulates a days activities by beginning when
the phone lines open and recording the calls throughout the day until
the phone center closes. Running this simulation many times (typi-
cally more than one hundred on a computerized model) allows the
ai ds Aidess management to draw some statistical conclusions about
the length of waiting time, counseling capacity utilization, and the
impact on waiting (and customer perception of the quality and value
of the experience) that opening up more phone lines presents.
Although this is a fairly simple illustration, it does show the use-
fulness of determining mathematically the relationship between the
service providers capacity and the average waiting time for the cus-
tomer in a way that allows the healthcare organization to find the ideal
balance between the two. This same technique can be used to deter-
mine the ideal number of monorails in a theme park, toll booths on a
turnpike, beds on a hospital floor, servers and cooks in a restaurant,
spaces in a parking lot, nurses in an emergency room, or any other
application where an organization needs to balance the costs of pro-
viding capacity with the quality of the service experience.
Certain basic forces affect waiting lines, and they can be expressed
mathematically. An explanation of the mathematics of waiting lines
appears in Appendix A.
326 achi evi ng servi ce excellence
Figure 12.2 Wheels Representing Time Between Calls and Time for Calls
Time Between Customer Calls
(in minutes)
Time for Customer Calls
(in minutes)
5
(12%)
6
(8%)
0
(15%)
1
(20%)
2
(25%)
4
(10%)
3
(10%)
1
(5%)
8
(5%)
2
(15%)
3
(20%)
4
(25%)
6
(10%)
5
(15%)
7
(5%)
Fotter/book 8/12/02 3:47 PM Page 326
Exhibit 12.3 Wheels Representing Time Between Calls and Time for Calls
320 Achieving Service Excellence
APPENDIX A: THE MATHEMATICS OF WAITING LINES
The mathematics are quite simple for a single-channel, single-phase
line. An understanding of a few calculations will reveal much about
how to manage customer waits. In the following example, we will use
a single-channel line for a laboratory facility with one lab technician.
We will calculate the average amount of time that a patient waits for
service and remains in the system (time waiting plus time being served).
In addition, we will determine the idle time of the technician. These fig-
ures will be useful to a healthcare manager wishing to control the wait-
ing time for patients and to reduce the idle time for the technician.
These calculations for a single-channel, single-phase line can be
done by hand. However, more complicated wait systems requiring more
complex formulas should be (and can easily be) analyzed by computer.
Standard spreadsheet products, such as Excel, have the capacity to per-
form a wait analysis.

Ten patients are expected to arrive during the hour. This is the
arrival rate.
The formulas use the following symbols:
l = arrival rate per hour (ic)
m = service rate per hour (i,)
1. Average time a patient waits:
,, achi evi ng s ervi ce excel l ence
Fotter/book 8/12/02 3:47 PM Page 334
The Hypothetical Laboratory has a simple waiting room and one
technician. Ben Blake, the manager, has been observing the wait at the
laboratory for several weeks. Not wanting patients to wait too long, but
hesitant to incur the cost of hiring another technician, he wishes to
calculate the average wait for his patients over a one-hour period. He also
wants to know how much idle time the single technician will have
during that hour. If the technician has substantial idle time, Mr. Blake
would like for her to perform some routine tasks, such as fill out patient
records and consult by phone with other technicians. He has compiled
the following information for this one-hour period. For this example, we
ignore variability and use averages to describe both arrival and service
rates for the lab's patients.
The average time it takes to treat a patient is four minutes; the techni-
cian can treat about i, patients per hour. This is the service rate-the
units of service provider capacity per time period.
Wq = l/m(l-m) Wq = ic/i,(i,-ic) Wq = .i,, hours or minutes
Wq means waiting time before being served. This calculation tells
(Continued)
SIDEBAR B: THE MATHEMATICS OF WAITING LINES
Chapter 12: Waiting for Healthcare Service 321
line is unique and they need assistance so badly, the help center might be able to
let the phone queues grow without much adjustment. The essential feature of the
calculation is to determine the point beyond which the length of the wait affects
the quality of the client experience beyond the level acceptable to the client and
the organization.
Once a decision has been made about capacity and demand balance, the organi-
zation has to plan for accommodating the inevitable waiting lines that uneven de-
mand patterns create. Here the challenge is to manage the wait in such a way that
Mr. Blake that the average wait for a patient is minutes. If that
wait time is unacceptable to him, he may have to add another
technician.
2. Average time a patient spends in the system:
T
s
= i/m-l
Ts
= i/i,-ic
Ts
= .: hours or i: minutes
This equation tells Mr. Blake that the average patient spends i: min-
utes in the system, including both waiting time and service time.
3. Average number of patients waiting:
L
q
= l:/m(m-l)
Lq
= ic:/i,(i,-ic)
Lq
= i.,, patients
L
q
means the average length of the queue, in number of patients.
Knowing that only i.,, patients are waiting at any one time, on
average, reveals to Mr. Blake that the space available in the wait-
ing area is sufficient.
4. Percentage of time the technician is busy:
b = l/m b = ic/i, b = o;%
The laboratory has one or more patients in it, either waiting or
being served, o; percent of the time, or about c minutes out of
every hour, on average.
5. Probability that there are no patients in the laboratory at any given
time:
p = i - (l/m) p = i - (ic/i,) p = ,,%
This is obviously the inverse of the previous formula. If the wait-
plus-treatment system has someone in it about c minutes out of
each hour, it is empty for the other :c minutes. Mr. Blake can use
this information to assign other tasks to the laboratory technician.
NOTES
1. Sherman, S. G. 1999. Total Customer Satisfaction: A Comprehensive Approach for
Health Care Providers, pp. 2627. San Francisco: Jossey-Bass.
2. Press Ganey Associates news release, January 10, 1997.
3. Press Ganey Associates, National Priority ListMedical Practices, March/April 1997.
4. Adapted from J. L. Heskett, W. E. Sasser, Jr., and C. W. L. Hart. 1990. Service Break-
throughs: Changing the Rules of the Game, pp. 13841. New York: The Free Press.
5. Cited in J. B. Jun, S. H. Jacobson, and J. R. Swisher. 1999. Application of
wai t i ng f or heal t hcar e servi ce ,,,
Fotter/book 8/12/02 3:47 PM Page 335
SIDEBAR B (continued)
322 Achieving Service Excellence
the customer is satised with it. Two major dimensions are involved. The rst is the
way the waiting feels to the customer. The second is how to minimize the negative
effects of the wait by managing the value of the experience to the customer. The
organization wants each customer to conclude that the experience made the wait
worthwhile.
A growing number of programs are helping doctors redesign their ofces by
xing problems that have long frustrated patients, such as week-long delays to get
appointments, hours spent in the waiting room on appointment days, too-brief
visits with the doctor, and the near impossibility of getting the physician on the
phone (Landro 2006b).
Programs that help doctors in solo and small group practices to work more
efciently heed lessons from other industries (Landro 2006b). One approach
relies on calculations used by airlines, hotels, and restaurants to predict demand.
The idea is that through better use of demand and capacity management strate-
gies doctors can cut patient waits in much the same way restaurants seat din-
ers and turn over tables efciently. Other approaches involve relatively simple
changes such as leaving afternoon appointments open for urgent visits, having
patients ll out paperwork ahead of time online, or providing follow-up care
through a phone call or an e-mail rather than taking up valuable ofce time.
Kaiser Permanente has launched a program to help the 12,000 doctors who con-
tract with its health plan to increase their efciency by using a new electronic
medical records system.
Weiss (2003) recommends the following practices for wait management:
Do the math to make sure the schedule is not too tightly packed.
Keep things moving during the day by having the right staff in the right
place at the right time, appointing a patient-ow coordinator to keep things
moving, not trying to do it all, setting aside time for returning phone
calls and doing administrative tasks, allowing after-hours visits, and using
modern technology.
Provide continual communication to patients while they wait.
Make sure the patient is provided with a variety of waiting room diversions,
or perhaps include pagers as some restaurants provide so that the patient can
leave the ofce for a while.
In many hospitals, ED patients are now able to check themselves in at computer
kiosks (Stengle 2008). For instance, Parkland Memorial Hospital in Dallas, Texas,
has three self-service computer kiosks, similar to those used by airport passengers
and hotel guests. Patients spend about eight minutes at the kiosks using touch
Chapter 12: Waiting for Healthcare Service 323
screens to enter their name, age, and other personal information and the ailments
they would like to see addressed. A nurse monitors the screen to assess patient
information, and those with chest pains, stroke symptoms, and other worrisome
complaints take priority. The result is a shorter ED wait at Parkland.
Often, family members are left in waiting rooms with little or no information
about the condition of their hospitalized loved ones. Creighton University Medi-
cal Center in Omaha, Nebraska, has addressed this problem by posting up-to-
date patient information on an electronic screen in the waiting room. To protect
patient identity, families are given a case number that represents their loved ones.
(OConnor 2007). In some hospitals, a color-coded system is used. Other hospitals
have pagers that alert family members that they should go to the information desk.
Such processes try to give family members information in real time.
THE PERCEPTI ON OF THE WAI T
Understanding what makes time y or drag while a person is waiting is a funda-
mental concern in improving the quality of the patient wait. The research on the
perception of waits has long supported the importance of managing this (DeMan
et al. 2005; McKim et al. 2007). Mowen, Licata, and McPhail (1993), for exam-
ple, studied the perception of waits in an ED and found that patients who received
time estimates were more satised than those who did not. Healthcare managers
must remember that everyone is different, that individual differences will inuence
how people feel about waiting in line, and that how people feel about the wait is at
least as important as how long the wait actually is. Following are factors that inu-
ence customers perceptions of a wait.
Occupied Time
As noted earlier, most line waits can be made to seem more enjoyable and less
lengthy if people waiting can be distracted or diverted in some way. Many clinics
and physician ofces have gone beyond the traditional magazine rack by offering
interactive video devices that help patients pass the time productively by learning
something about their health. A cancer specialist might offer an interactive video
that answers typical questions asked by new patients, or a dentist might feature
a video describing a procedure to whiten teeth. A childrens practice might offer
toys in a play area, and a physicians waiting room might have a television showing
CNN.
324 Achieving Service Excellence
The Walt Disney Company is the master of managing time waits by providing
diversion to its waiting guests. If the line for a particular attraction has become
extraordinarily long, a strolling band, acrobats, or some other distraction is sent to
entertain and occupy the guests. Although bands and acrobats might be inappro-
priate in a healthcare setting, pleasant diversions or distractions appropriate to the
situation can be provided for customers.
Time Spent Waiting for a Service Versus Time Spent
Receiving the Service
In many ofces, before patients are examined by the doctor, they are interviewed
by a nurse who listens to the medical complaint, gathers vital signs, and generally
obtains information. By the time patients are actually seen by the doctor, they have
already had considerable contact with a medical person, so the wait to see the doc-
tor does not feel so long.
Another way to spend the wait time is to teach patients in line what they are
supposed to do once they reach the treatment area. The education provided during
the wait time can improve or enhance the service experience and, in that way, ac-
tually becomes part of the experience. Videos in an orthodontists ofce can teach
kids how to insert and remove their retainers before they actually get them. The
orthodontist does not have to spend so much time teaching, and patients are en-
gaged before being tted for the device. Some organizations use a similar technique
while placing callers on hold. Callers listen to a range of options in the phone
menu, which helps them make the right choice. They may also be presented with
recorded instructional material so they may be better informed when they talk
to a real person. Most medical ofces require patients to ll out lengthy medical
history forms. These forms provide useful information, but they also give patients
something to do, which reduces how long the wait feels.
Anxious Waits
To patients who are apprehensive about what will happen to them during an
upcoming operation or about the results of a diagnostic procedure, the wait will
seem endless. Communication geared to reducing anxiety during such waits is
highly desirable. For most people, waiting to be discharged to go home is one
of the longest waits they face. They are so anxious to leave that any time spent
waiting is too long.
Chapter 12: Waiting for Healthcare Service 325
Uncertain Lengths of Wait
Providing a time estimate can help those waiting because they can see the end in
sight. The wait before a scheduled appointment is bearable because the patient
knows how long the wait will be, but once the appointment time is reached, in the
patients mind it is time to be served, and any time spent waiting after that will feel
longer. One orthopedic hospital discovered that by having the nursing staff in the
preoperative areas periodically check back with patients and update them on what
was happening, patient satisfaction was signicantly improved.
Unexplained Waits
When a patient does not know what is holding up the line or causing the delay,
the wait feels longer. Effective managers keep people who are waiting informed, or
they provide visual cues that explain the wait. For example, a longer-than-expected
wait in a doctors waiting room can be improved by explaining to those waiting
that the doctors schedule was interrupted by a serious emergency. On the other
hand, effective managers of queues will ensure that unoccupied laboratory person-
nel or empty treatment rooms are kept out of the sight of waiting patients so that
managers do not have to explain why their personnel are not serving patients or
why their treatment rooms have no one in them while the waiting room is full.
Unfair Waits
If customers think the queue discipline is being consistently followed and fairly
used, then the wait seems shorter than when they think people are being served
out of sequence. Good organizations recognize this truth and manage their lines
accordingly. At times, patients who are very sick or in some other special category
require the line discipline to be broken. These patients can perhaps be brought in
through another entrance so those waiting do not notice that the discipline has
been interrupted. For example, the ambulance entrance to the ED is usually some
distance from the walk-in entrance. This separation allows emergency patients to
be served rst and provides easy access for ambulances. Organizations that for
one reason or another need to break the queue discipline must nd some way to
communicate a reason for the apparent unfairness that patients will accept, such
as Heart attack case coming through! or Abdominal gunshot wound! People
generally defer their own needs to accommodate other peoples more immediate
326 Achieving Service Excellence
needs as long as they know why. For example, passengers needing assistance board
planes rst and nobody minds, drivers pull over to let emergency vehicles move
past the trafc queue, and people seldom complain when a disabled person goes to
the front of the line.
Solo Waits Versus Group Waits
Waiting by yourself feels longer than waiting with family or friends or even with
people you do not know. Facilities that recognize this perceptual issue try to organize
their waits in such a way that people are grouped with other people. Under this logic, a
double line feels shorter than a single line, and a line structure that encourages people
to interact feels shorter than one in which people are allowed to stay inside their own
personal and highly individual spaces. In some waiting room areas, seating might be
arranged to promote interaction and a sense of being part of a group.
Uncomfortable Waits
Finding a way to keep people comfortable while they wait for treatment is a mana-
gerial challenge. Besides the obvious methods, such as providing comfortable seats
and air conditioning or heating, healthcare providers must take special care of
those with special medical needs. For example, a seriously injured person is im-
mediately given pain medication, and a comfortable bed is quickly found for the
victim of a possible heart attack.
Uninteresting Waits
Because most people like to talk about themselves, they will be interested in con-
versing with someone who asks them questions. Having a nurse or a clinical as-
sistant ask questions, take body measurements, and generally pay attention to the
patient will make the wait time more interesting. Providing interactive games and
other pleasant distractions may also make the wait more interesting.
Other Considerations
In all of these waiting situations, the customers emotional state will have a signi-
cant impact on the wait for service. Different people react differently to anxiety,
Chapter 12: Waiting for Healthcare Service 327
uncertainty, pain, and other perceived inuences on the waiting time. If the wait-
ing line is composed of people with diverse needs, the typical customer may drive
the design of the line and the associated wait. Although managers must consider
individual needs as much as possible in designing and managing waits, the queue
for a large customer volume must be designed to accommodate the waiting expec-
tations of a typical, average customer.
However, if the people in line are a more select clientele with identiable features
(e.g., big donors), then variability in treatment of the waiting customers should be
planned to meet that groups expectations for an upscale level of service. Making
the wait enjoyable or at least bearable is harder to do for a mass-market customer
base than for a select, known clientele.
In all of these waiting situations, the contrast effect will also inuence the percep-
tion of the wait. If a customers rst wait is comfortable, totally explained, and pre-
dictable, and the second wait is unpredictable, anxiety producing, and of uncertain
length, the second wait will feel longer and less satisfying than the well-managed
rst wait. Similarly, if a customer has just had a long wait, a short one will feel
even shorter in contrast. If the customer has just been in a waiting situation where
employees were friendly and all staff were busy assisting customers, that wait will
in retrospect seem shorter than a wait of identical length in which employees seem
unfriendly and engaged in activities other than serving people who are waiting.
The key is to remember that the customer perceives the wait through his par-
ticular perspective despite the reality. If the objective data say the wait at your facil-
ity is not too long or the average wait at your organization is shorter than it is at a
competitors, those data do not matter to customers who think they have waited
too long for your service. Customers have mental clocks that tell them when the
wait is too long and when it is just right and extremely well managed. Managing
the perception is as effective a technique as managing the actual waiting time, and
if the organization is particularly good at managing perceptions, it can make even
very long waits acceptable and tolerable to customers.
Perceived Value of Service
The more value the customer receives or expects to receive from the service, the
more the customer will wait without complaining or being dissatised. Because the
customer denes the value of services rendered, the perceived value of the service
for which the customer is waiting must be managed. This strategy can be imple-
mented before, during, or even after the service is performed.
Before receiving the service, waiting customers can be provided with informa-
tion (or even with some other service) that will enhance the value of the service
328 Achieving Service Excellence
that motivated them to enter the queue in the rst place. A health spa or wellness
center, for example, can offer customers waiting in line healthy snacks or fruit or
can play chamber music in the background. Such thoughtful touches not only
distract and occupy the customer but also add value to the experiences that the spa
and center are selling and for which the customer must wait.
During the performance of the service, its value (to the customer and as dened
by the customer) can be enhanced over the customers expectations by a number
of strategies. The organization will want to use these strategies in any event, but if
the service meets or exceeds expectations when the customer gets it, the wait will
probably seem worthwhile. Besides providing customers with a service that is be-
yond their expectations in the rst place, some subtle actions can enhance the value
of the service experience. For example, some hospitals display their accreditation
certicate, and some doctors display diplomas from medical schools to indicate the
quality of their training. These touches tend to encourage the patient to think the
medical treatment was worth the wait.
As a more direct response to the wait, the service provider can apologize for
and explain any unusual factors that may have caused the wait. Apologizing adds a
personal touch that may enhance the value of the experience for the customer. For
example, a family physician extends his apologies to patients in the waiting room
when he is running late on schedule. He says, It never fails to bring smiles when I
acknowledge that the patients time is as important as mine (Weiss 2003, 81).
Today, many healthcare organizations instruct their medical staff to apologize
for inevitable waits, while other hospitals ask staff to act as patients so that they
can understand what service waits feel like. Increasing their sensitivity to patient
waits raises the possibility that staff will proactively engage the waiting patients and
better manage their experience.
After the service, the value of the experience can sometimes be enhanced to
make the customers feel better about having taken the time to wait in the rst
place. Although advertising is generally used to attract the attention of potential
customers, people who have already purchased services are even more attentive to
ads than those who have not. The ads reinforce their wisdom in not only purchas-
ing the service but also waiting in line to do so. Ads seen ahead of time can also
reduce the effects of the wait while it is in progress; by convincing customers that
the experience will be worth the wait, they will wait more patiently. Some organi-
zations have found that a follow-up phone call asking a customer for reactions to
the service can enhance the value of the experience and reduce the negative effects
of the wait.
Chapter 12: Waiting for Healthcare Service 329
CONCLUSI ON
Managing the customers wait is a fundamental challenge for healthcare managers.
Service cannot be stockpiled or inventoried, and the organization must nd the right
balance between having enough physical and personnel capacity to ll demand and
having so much capacity that some healthcare services sit idle most of the time. In a
perfect world, the ow of customers exactly matches the supply: When one patient
leaves the facility, another walks in the door seeking medical care; when the physician
nishes with one patient, another arrives; and so on across the entire range of services
offered by healthcare organizations. In our less-than-perfect world, effective queue
management can get patients into the medical setting and meet their time expecta-
tions to their satisfaction.
Service Strategies
1. Manage the wait; do not just let it happen.
2. Know how long customers are willing to wait without becoming
dissatised.
3. Know the psychology of waits and manage waits to minimize customer
dissatisfaction.
4. Use queuing or waiting-line models to understand how queues work.
5. Build in adequate capacity, and manage demand by calculating and
implementing design days and capacity days.
6. Minimize the negative effects of the wait before, during, and after the
healthcare experience.
7. Create and implement performance standards for waiting times.
8. To better balance capacity with demand, nd out how much a dissatised
customer costs the organization.
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331
Standardsbeing able to specify what good, bad, and great service look like
are prerequisites to asking people to deliver.
Karl Albrecht and Ron Zemke
C H A P T E R 1 3
Measuring the Quality
of the Healthcare Experience
Service Principle:
Measure the important things, and then pursue
the superb healthcare experience relentlessly
All customers expect to have an outstanding experience every time. Even
though they know perfection is elusive, they hope that whatever errors happen will
not happen to them. All healthcare organizations face rising patient expectations
and patients who are increasingly unwilling to settle for less than they think they
are entitled to. Customer activism coupled with growing access to information
have made service quality more important than ever as healthcare managers strive
to identify and meet heightened patient expectations for their healthcare experi-
ences.
Service quality has become an important competitive advantage in todays
healthcare market (Berry 2009). Indeed, some evidence suggests that the process
quality of providing healthcare (the how) is as important as the clinical quality (the
what) (Marley, Collier, and Goldstein 2004). Because most patients are unable to
accurately assess the quality of their clinical care, they rely on the quality of the
processes they observe and the way they are treated to determine the quality of
their patient experience (Otani, Kurz, and Harris 2005).
Consequently, the Malcolm Baldrige award for excellence in healthcare includes
focus on patients, other customers and markets as one of the assessment factors.
Research continues to suggest that the Baldrige criteria affect patient satisfaction
(Goldstein and Schweikhart 2002; Naveh and Stern 2005). Healthcare providers
that seek this prestigious award are paying more attention to both clinical quality
in patient care and the process by which this care is delivered.
332 Achieving Service Excellence
An obvious way of creating a awless experience for tomorrows patients is for
the organization to know what errors are being made or what problems are oc-
curring now. Therefore, measuring the quality of the healthcare experience is an
increasingly important part of the leadership responsibility of the healthcare orga-
nization (Marley, Collier, and Goldstein 2004). Satised patients prefer to come
back to the healthcare provider that met or exceeded their expectations for clinical
and patient experience outcomes. Dissatised patients seek to go somewhere else
when they have other healthcare options (Boshoff and Gray 2004; Rohini and
Mahadevappa 2006).
The best time to nd out about possible problems in the patient experience is
before the patient leaves the healthcare facility, while the information is still fresh
in the patients mind. Finding out on the spot also gives the organization the op-
portunity to recover from problems before the patient leaves angry over some error
or mistake that might have been corrected if someone had asked.
Accurately measuring what patients think about their experience in physical
therapy, their overall hospital stay, or their experience in obtaining laboratory tests
is a difcult challenge for healthcare organizations striving to achieve service excel-
lence. Nevertheless, it must be donepreferably before the patient leavesand its
best to do this consistently and carefully.
In this chapter, we address the following:
How the patient perceives the quality of the healthcare experience
How healthcare managers can see problems from the patients perspective
Measurement methods that show the organization where it needs to improve
or change its service, setting, and delivery system to meet patient expectations
The critical challenge for healthcare managers is identifying and implementing the
methods that best measure the quality of the experience from the patients point of
view. As we have stated throughout this book, the patient determines quality and
value. Consequently, what is an acceptable experience for one patient might be a
superb experience for another and a serious problem to a third.
The subjective nature of the quality and value of a healthcare experience makes
identifying and implementing the appropriate measurement particularly difcult.
No matter how well management or the medical staff plan a treatment, surgery,
or therapy, the quality of the healthcare experience cannot be measured until the
patient experiences it.
A variety of methods are available to measure the quality of the healthcare experi-
ence. These methods differ in cost, accuracy, and degree of patient inconvenience.
Chapter 13: Measuring the Quality of the Healthcare Experience 333
Measuring healthcare quality can have many organizational benets, but as usual
the benets must be balanced against the costs of obtaining them.
In other words, the organization must balance the information needed and
the extent and precision of the research expertise required to gather and in-
terpret it against the availability of funding. As a rule, the more accurate and
precise the information, the more expensive it is to acquire. Typically, organiza-
tions use both qualitative and quantitative methods. Each will be discussed in
the sections that follow.
QUALI TATI VE METHODS
Qualitative techniques are generally less expensive than quantitative methods.
Exhibit 13.1 outlines the major qualitative techniques and their advantages and
disadvantages. The qualitative techniques include management observation, em-
ployee feedback programs (e.g., work teams, quality circles), and focus groups.
Qualitative measures should have a quantitative component. Excellent health-
care managers seek to make quantitative even the most qualitative assessments by
systematically recording what they observe or hear. If a manager encounters an
angry patient with a complaint, the manager should have a record that four previ-
ous angry patients said the same thing. This systematic approach allows even the
most qualitative assessment process to take on many of the benecial features of
the most quantitatively precise process.
Management Observation
The simplest and least expensive technique for assessing quality is to encourage
managers to keep their eyes open, especially to the interactions between staff and
patients and other customers, and to talk to employees and patients. This tech-
nique has been called management by walking around, or MBWA. Some health-
care organizations, borrowing a term from the restaurant industry, call it walking
the front, which means observing what is happening rsthand, looking for prob-
lems or inefciencies, talking to patients and staff to assess their reactions, nding
solutions to any patient problems encountered, and sharing with staff any informa-
tion that might enable them to improve the healthcare experience. More recently,
other healthcare experts have borrowed the term rounding from the clinical side
to describe this managerial technique. Indeed, Studer (2008) is so convinced of the
3
3
4


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c
h
i
e
v
i
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g

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e
r
v
i
c
e

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c
e
l
l
e
n
c
e
m
e
a
s
u
r
i
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e

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e
a
l
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e

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,
Table 14.1 Advantages and Disadvantages of Various Qualitative Techniques for Measuring Patient Service Quality
Management
T s e g a t n a v d a s i D s e g a t n a v d A s e u q i n h c e
Management Management knows business, policies, and Management presence may influence service
s r e d i v o r p s e r u d e c o r p n o i t a v r e s b o
y t i l i b a i l e r d n a y t i d i l a v l a c i t s i t a t s s k c a L t n e i t a p o t e c n e i n e v n o c n i o N
Opportunity to recover from service failure Objective observation requires specialized training
Opportunity to obtain detailed patient feedback Employees disinclined to report problems they
Opportunity to identify service delivery problems created
Minimal incremental cost for data gathering Management may be unfamiliar with processes
and customers
Employee Employees have knowledge of service delivery Objective observation requires specialized training
y e h t s m e l b o r p t r o p e r o t d e n i l c n i t o n s e e y o l p m E s e l c a t s b o k c a b d e e f
programs Patients volunteer service experience information created
to employees
No inconvenience to patients
Opportunity to recover from service failure
Opportunity to collect detailed patient feedback
Minimal incremental cost for data gathering and
documentation
Work teams Develops employee awareness of managements Employees may wish to avoid responsibilites of
and quality strong commitment to service quality empowerment
circles Develops an understanding and appreciation of Team may not act cohesively and work together
how each employee can directly influence service Necessary communication among team members
e m i t f o t n u o m a e g r a l s e k a t y t i l a u q
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Exhibit 13.1 Advantages and Disadvantages of Various Qualitative Techniques for Measuring Patient Service Quality
(Continued)
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Table 14.1 (continued)
Work teams Through empowerment, improves employee morale,
and quality productivity, efficiency, effectiveness, and patient
circles (cont) satisfaction
Team working together conveys confidence and
competence to patients
Focus groups Opportunity to collect detailed patient feedback May only identify symptoms and not core service
Opportunity to recover from service failure delivery problems
Qualitative analysis helps to focus managers on Feedback limited to small group of customers
s l i a t e d r e t n u o c n e e c i v r e s c i f i c e p s f o n o i t c e l l o c e R s a e r a m e l b o r p
Other problems may surface during discussions may be lost
Suggests that facility is interested in patients One group member may dominate or bias discussion
r o f s e v i t n e c n i s e t a t i s s e c e n e c n e i n e v n o c n I y t i l a u q e c i v r e s f o s n o i n i p o
participation
High cost of properly trained focus group leader
Information may be withheld due to fear of
disapproval by others
May not be representative sample of the patient
population
Service Provides feedback on service failures in significant Self-selected sample of patients not statistically
e v i t a t n e s e r p e r s a e r a s e e t n a r a u g
Enhances both measurement and marketing Some patients may take advantage of organization
Source: Adapted with permission from R. C. Ford, S. A. Bach, and M. D. Fottler, Methods of Measuring Patient Satisfaction in Health Care
Organizations, 22 (2), page 77, 1997, Aspen Publishers, Inc.
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Exhibit 13.1 (continued)
336 Achieving Service Excellence
merits of this tool that he devotes two chapters in his book to roundingone on
rounding with employees and one on rounding with customers.
Managers know their own healthcare operation and its goals, capabilities, and
healthcare quality standards. They know, at least from the managerial perspective,
when staff members are delivering a high-quality experience.
Managerial observations do not inconvenience patients or staff, and they often
permit immediate correction of patient-service problems. Everyone, including pa-
tients, appreciates being asked by a manager what he or she thought of the experi-
ence. Asking is strong evidence that the organization cares about service quality
and is committed to helping employees deliver it.
Furthermore, managerial observation gives supervisors the opportunity to
recognize, reinforce, and reward an excellent employee and coach an employee
who might not be delivering the service as it should be delivered. It also provides
a teaching opportunity where a supervisor who observes a service problem can
model the way to x it. Moreover, when managers walk the front to act as coaches
and not as spies, their presence has a favorable inuence on employee attitudes and
performance as well as on patient satisfaction.
Relying only on managerial observation for assessing service quality has its
downsides, however. Some managers may not have enough experience or training
to fully understand what they are observing; they may have biases that inuence
their objectivity; they may not know how to effectively coach an employee or
handle a distraught customer; or they may be too busy with paperwork or unwill-
ing to make the time to actively observe.
Also, when employees know managers are observing the service delivery pro-
cess, they invariably perform it differently. In addition, although management ob-
servation may ensure the quality of the experience for a particular patient, even
the most energetic manager cannot watch every patientemployee interaction. An
unobserved patients reactions to an unobserved experience remain unknown to
the manager.
Training healthcare managers in how to observe employeepatient interactions,
measure these interactions against quality standards, and coach providers and em-
ployees can eliminate or at least reduce personal bias. Managers may think they
have no time to observe interactions, but they could be wrong when they review
their own time usage. Unobtrusive observational techniques, random observations,
and video cameras can diminish employee awareness that the boss is watching.
For example, many organizations tell their telephone operators and callers that
all phone conversations may be monitored for training purposes to eliminate the
observation bias by making it uncertain when management is actually listening in.
The operators know someone may always be listening, so they do the job by the
book. Some larger companies use managers from one location to observe employ-
Chapter 13: Measuring the Quality of the Healthcare Experience 337
ees at another location for the same reason. The increasing use of video monitoring
to enhance security has had the unintended but benecial consequence of encour-
aging employees to think of themselves as being under constant supervision. For
obvious ethical reasons, employees and customers should be alerted that they may
be monitored.
Employee Feedback
Employee feedback should supplement management observation. Employees can
provide input on such issues as cumbersome organizational policies and control
procedures, managerial reporting structures, or other processes that inhibit effec-
tive healthcare service delivery. They know rsthand about organizational impedi-
ments that prevent them from delivering high-quality service (Gupta 2008).
In fact, a study by the authors (Fottler et al. 2006) found that a focus group of
employees identied the same problems with more detail than a customer focus
group. This raises the possibility of using employee focus groups as a less expensive
alternative to customer focus groups or even employee surveys for discovering is-
sues and concerns in the healthcare organization that interfere with patient service
quality. The study concluded that employees know what is wrong with the patient
experience and are glad to tell when management asks.
Employee work teams and quality service circles are other sources of feedback.
Such techniques foster an understanding and appreciation of how each employee
can directly inuence service quality. Employee awareness of managements strong
commitment to healthcare quality is afrmed when work teams are asked to review
all aspects of the customer service experience. Use of work teams requires the or-
ganization to invest in employee training and to allow team members the time to
meet. This step sends two important messages: (1) Management trusts employees
ability to nd and x problems, and (2) the organization is truly committed to
service if it spends precious resources on providing it.
Another employee feedback process is the patient ombudsman position. The
ombudsman is responsible for seeking out patients to hear their concerns and re-
porting these problems to someone who can address them, if the ombudsman does
not have the ability to x them. Generally, the ombudsman is viewed as a resource-
ful, friendly, trustworthy employee to whom customers can air out their grievances
without fear of repercussions. Typically, the ombudsman reports directly to a se-
nior manager who oversees patient satisfaction efforts.
For example, in one hospital, the cheer bringer, who previously delivered
cards and owers to patients, was given the ombudsman role after management
realized that the hospital had no formal complaint procedure. Inpatients were not
338 Achieving Service Excellence
likely to complain about the staff as they feared retaliation or mistreatment. With
her new ombudsman role, the cheer bringer went around asking patients of their
concerns. Because the cheer bringer was already a well-liked and trusted staff mem-
ber, she was the ideal person to approach patients about their complaints.
Focus Groups
Focus groups provide in-depth information on how patients and other customers
view the service they receive. Typically, a focus group of six to ten persons gath-
ers with a facilitator for several hours to discuss real or imagined problems and to
make suggestions. Many service organizations routinely invite customers to par-
ticipate in focus groups. These invitations show customers that the company cares
enough about their reactions to ask them to participate, and customers appreciate
the dollars, complimentary dinner, or other expression of appreciation that typi-
cally compensates them for their time.
One reason organizations use focus groups is to supplement survey results,
which often fail to produce information that is useful for program improvement
because the information is not discriminating or comprehensive enough (Berry
2009). Surveys only tell management what the survey measures and not necessarily
what is really important to the patient. Surveys may only ask for satisfaction ratings
about areas that are not key drivers of customer (patient and staff ) satisfaction.
Surveys generally are limited to asking about what happened in the past and not
about what the patient desires in the future. In addition, surveys rely on patients
memories of experiences they are frequently eager to forget. Finally, surveys may
too narrowly frame the range of possible responses, which could result in overesti-
mating satisfaction (Fottler et al. 2006).
Patient focus groups can provide valuable feedback about what patients expect,
and they are particularly effective in identifying factors patients nd important or
missing (Fottler et al. 2006). Because focus group questions are open ended and
amplication is invited, participants experiences, opinions, expectations, and sug-
gestions are likely to be richer in content and context than survey data.
Service Guarantees
The service guarantee method is based on a given customers subjective perception
of whether an aspect of the service was or was not completely satisfactory. Prom-
ises such as satisfaction guaranteed or your money back; no questions asked and
Chapter 13: Measuring the Quality of the Healthcare Experience 339
satisfaction guaranteed or get 50 percent off your next purchase have worked well
across the service industry. A longitudinal study by Hays and Hill (2006) found
that service guarantees have a positive, long-term effect on both employee motiva-
tion and customer intention to return. This study strongly supports using a service
guarantee to improve customer loyalty and to increase employee motivation.
JetBlue is one organization that provides a service guarantee, and that guarantee
is spelled out in its customer bill of rights (Airoldi 2007):
JetBlue compensates customers if, as a result of JetBlues decisions, an airplane
takes more than 30 minutes to reach the gate after it lands.
For arrival delays, customers receive vouchers applicable to the purchase of
future ights: $25 for delays of up to 1 hour, $100 for delays of 1 to 2 hours,
the cost of a one-way ticket identical to the one purchased for a
2- to 4-hour delay, and the cost of a roundtrip ticket for delays of more
than 4 hours.
JetBlue gives customers a $100 voucher for departure delays of 3 hours and
a voucher for a new trip after 4 hours. People are removed from the airplane
after delays of 5 hours.
JetBlue provides customers with $1,000 in cash, rather than the $400 the
federal government requires, if they are ever denied boarding.
By contrast, such guarantees and patient bills of rights are quite rare in health-
care. According to one classic study, the average business spends six times more
money on marketing to potential new customers than it does working to keep the
customers it has (Sherman and Sherman 1998, 164). Some evidence suggests that
acquiring new customers is cheaper than retaining current ones, but some health-
care insiders argue for the exact opposite (East, Hammond, and Gendall 2006).
Healthcare facilities focus their marketing programs on recruiting new custom-
ers, yet they typically offer no quality or satisfaction guarantees to their current or
prospective customers to assure them of the excellence of their healthcare service.
So why do healthcare organizations not offer guarantees that are similar to those
offered by other service businesses? They should be able to at least guarantee that
staff will answer the phone in a reasonable period of time, patient paperwork will
be minimized, food will equal restaurant quality, wait times at discharge and clini-
cal locations will be minimal, all facilities will be clean, and staff members will be
friendly and respectful.
According to Fabien (2005), service guarantees provide a number of im-
portant advantages to organizations, including organizational learning. If a
company has a strong and well-understood service guarantee that is invoked
340 Achieving Service Excellence
by its customers, everyone in that organization learns about the service deliv-
ery system. Similarly, Hart (1988) lists several important benets of a service
guarantee:
It forces everyone to think about the service from the customers point of view
because the customer decides whether or not to invoke it.
It pinpoints where the service failed because the customer must give
the reason for invoking the guarantee, and that reason then becomes
measurement data on the service delivery system. A patient complaint
is a good thing for a healthcare organization that hopes to be perfect.
Guarantees are an incentive to get customers to complain if their
expectations (and the guarantees terms) have not been met, and these
complaints then help the organization to x whatever is wrong before
other customers have problems.
It gets everyone to focus quickly on the problem at hand because the costs of
making good on guarantees can be quite large. Once a customer has to invoke
the guarantee, the cost of the lost revenue forces management to direct its
attention at correcting the problem.
It enhances the likelihood of recovery from a service problem because the
patient is encouraged to demand instant recovery, instead of writing a
complaint letter and taking the business to a competitor.
It sends a strong message to employees and customers alike that the
organization takes its healthcare quality seriously and will stand behind it.
Sidebar A provides classic service guarantee criteria from Hart (1988).
QUANTI TATI VE METHODS
Although qualitative methods for assessing service quality have their benets, good
organizations are even more interested in measuring what patients themselves (and
sometimes their families) think about their experiences in some quantitative for-
mat. Patients are typically willing to tell healthcare providers what they liked or did
not like about their experience. Studer (2008) stresses the importance of this. A
large body of literature describes a variety of techniques to gather patient satisfac-
tion and perceptions of service quality data (e.g., National Quality Forum 2005;
Ford, Bach, and Fottler 1997). Techniques to collect data directly from patients
vary in cost, convenience, objectivity, and statistical validity.
Exhibit 13.2 provides an overview of patient-sourced quantitative methods and
shows the advantages and disadvantages of each technique.
Chapter 13: Measuring the Quality of the Healthcare Experience 341
Performance Standards
Outstanding organizations develop quantitative performance standards and mea-
surements so that employees can monitor their own actions. Some standards are
used throughout the industryfor example, 3 minutes to respond to a Code Blue,
20 minutes for breakfast trays to be served after arriving on the oor, and 5 min-
utes for a room call light to be answered.
Most standards are specic to the organizations that create them and are de-
signed to meet or beat the competition and to meet patient expectations. Emer-
gency departments dene how many minutes it should take for a newly arrived
patient to be triaged. If it has not happened in, say, 5 minutes, then the healthcare
quality standard has not been met. Nurses may use a measure of the number of
SIDEBAR A:
CRITERIA FOR A SERVICE GUARANTEE
1. Unconditional. The more asterisks or conditions
attached to the bottom of the page and the
more ne print, the less credible the guarantee
will seem to employees and customers. Few
or no conditions should be required to use the
guarantee.
2. Easy to understand and communicate. The
more complicated the guarantee is, the less
likely anyone will believe or use it.
3. Focused on the customers needs. The
guarantee should solve the customers
problems, not fit the organizations
needs.
4. Clear on defining the standard for healthcare
quality. If you are going to guarantee
it, you better deliver it the way you are
supposed to.
5. Meaningful to the customer and the
organization. If invoking the guarantee only
partially solves the customers problem or
is of little consequence to the organization,
neither the customer nor the service people
will value the guarantee.
6. Easy to use. Invoking the guarantee and
receiving its benets should be painless for
the patient. The harder a guarantee is to
use, the less credible it will be, and the less
likely it will help identify serious service
problems.
7. A declaration of trust. This trust extends to
the customers you are trusting to use it only
when they have a legitimate complaint and
the employees you are trusting to correct
the customers problem quickly, fairly, and
effectively without giving away the whole
organization.
8. Credible or believable by the customer. If
customers do not believe you will really
make good, then they will not use the
guarantee.
Source: Adapted by permission of Harvard Business Review from The Power of Unconditional Service
Guarantees, by C. W. L. Hart, 66 (4): 5462. Copyright 1988 by the Harvard Business School of Pub-
lishing Corporation; all rights reserved.
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Table 14.2 Advantages and Disadvantages of Various Quantitative Techniques for Measuring Patient Service Quality
Management
Techniques Advantages Disadvantages
Comment Suggests that facility is interested in patients Self-selected sample of patients not statistically
cards opinions of service quality representative
Opportunity to recover from service failure Comments generally reflect extreme patient
Minimal incremental cost for data gathering dissatisfaction or extreme satisfaction
Moderate cost
Mail surveys Ability to gather representative and valid Recollection of specific service encounter details
samples of targeted patients may be lost
Opportunity to recover from service failure Other service experiences may bias responses
Patients can reflect on their service experience because of time lag
Suggests that facility is interested in patients Inconvenience necessitates incentives for participants
opinions of service quality Cost to gather representative sample may be high
Allows comparisons of patient satifaction by Potential problems with the wording of questions
department and patient demographics
On-site Opportunity to collect detailed patient feedback May not be representative sample of patients
personal Opportunity to recover from service failure Other service experiences may bias responses
interviews Ability to gather representative and valid sample Respondents tend to give socially desirable responses
of targeted patients Inconvenience necessitates incentives for participants
Suggests that facility is interested in patients Cost moderate to high
opinions of service quality
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Exhibit 13.2 Advantages and Disadvantages of Various Quantitative Techniques for Measuring Patient Service Quality
(Continued)
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Table 14.2 (continued)
Telephone Opportunity to collect detailed patient feedback Individuals tend to find telephone calls intrusive
interviews Ability to gather representative and valid sample Difficult to contact people at work; inconvenient
e m o h t a s t n e i t a p d e t e g r a t f o
Opportunity to recover from service failure Costs of skilled interviewers and valid instrument
Suggests that facility is interested in patients are high
f o n o i t c e s - s s o r c e v i t a t n e s e r p e r a e t a r e n e g t o n y a M y t i l a u q e c i v r e s f o s n o i n i p o
patients
Mystery Consistent and unbiased feedback Snapshot of isolated encounters may be
d i l a v n i y l l a c i t s i t a t s s n o i t a u t i s c i f i c e p s n o s u c o f n a C s r e p p o h s
h g i h o t e t a r e d o m t s o C t n e i t a p o t e c n e i n e v n o c n i o N
Opportunity to collect detailed customer feedback Not applicable to all clinical areas (e.g., surgery)
Allows measurement of training program Ethical concerns
effectiveness
Source: Adapted with permission from R. C. Ford, S. A. Bach, and M. D. Fottler, Methods of Measuring Patient Satisfaction in Health Care
Organizations, 22 (2), page 81, 1997, Aspen Publishers, Inc.
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Exhibit 13.2 (continued)
344 Achieving Service Excellence
rings for answering a patient call. If a nurse has not responded to the call within a
certain number of rings, the quality standard has not been met.
These are examples of the types of standards that can be developed, measured,
and used as ways to ensure that the healthcare experience is delivered as it should
be. In his classic work Quality Is Free, quality expert Phillip Crosby (1978) notes
that the price of not conforming to a quality standard can be calculated as the cost
to x errors and failures that result from not meeting quality standards in the rst
place. Some organizations may think that determining the cost of not answering
the phone within three rings is impossible, but healthcare experts are convinced
otherwise (e.g., Studer 2008).
To prevent customer service problems, an organizations own performance stan-
dards should exceed those of all but the most demanding patients. If they do, the
organizations internal control measures may sometimes show that a standard has
not been met, even if patients seem satised and no one complains. When that
happens, some organizations in the service industry actually apologize.
Patients will remember healthcare organizations that behave this way as much
as they remember other service organizations that have learned the power of the
apology. Healthcare executives may fear that offering apologies may lead to a law-
suit, because an apology may seem like an admission of liability, but benchmark
healthcare organizations have learned how to gain the benets of offering apologies
without admitting liability.
Comment Cards
Comment cards are the cheapest and easiest to use of all data-collection methods.
If properly designed, they are easy to tally and analyze. These advantages make
them attractive for gathering patient satisfaction data, especially for smaller orga-
nizations that cannot afford a quality assessment staff or consultants. Comment
cards rely on voluntary patient participation and involve patients rating the quality
of the healthcare experience by responding to a few simple questions on a con-
veniently available form, typically a postcard. Patients deposit the form in a box
placed near the healthcare facility exit, return it directly to the service provider, or
mail it to the organizations ofce.
Following are six reasons to use comment cards (Szwarc 2005):
1. To identify the particular needs and concerns of each major customer group
2. To be able to quickly and accurately assess the impact of service improvements
from the customers point of view
Chapter 13: Measuring the Quality of the Healthcare Experience 345
3. To speed up the feedback cycle, so customer input is gathered quickly
4. To have an easy method for getting candid feedback from customers
5. To supplement anecdotal feedback with quantitative data
6. To have a systematic way to nd problems when you are implementing service
improvements
To develop a useful comment card, a healthcare organization should identify
its customers for particular services, study these customers, and nd out what is
important to them in terms of service. Once these expectations have been de-
termined, comment-card questions are developed. If studies reveal that patients
expect a friendly greeting, prompt attention, and detailed information about the
treatment procedure when they visit a physicians ofce, the ofces comment card
will ask patients about those elements of the healthcare experience. If an organiza-
tion tries to differentiate itself from similar organizations in some particular way,
that differentiating factor may also appear on the comment card, so that the orga-
nization can gauge the success of its differentiation strategy.
Comment cards give an indication of whether the organization is meeting the
general expectations of the customers who take the time to ll them out. Written
comments about long call-response waits, lines at the reception desk, or house-
keeping problems reveal the strengths and weaknesses of the service delivery sys-
tem, the personnel and their training, and the service itself.
Positive comments can also provide management with the opportunity to rec-
ognize employee excellence. This recognition reinforces the behaviors that lead
to good patient service and creates role models and stories about how to provide
outstanding service that other employees can use in shaping their own behavior in
their jobs. Negative comments can be used in training, without mentioning spe-
cic employees, to illustrate behaviors that caused negative healthcare experiences.
Using comment cards in these ways allows managers to train employees in how to
provide excellent patient service through the voices of the patients themselves.
Comments accumulated from cards may be plotted as numerical values on bar
graphs and charts that visually display how patients perceived their experience. The
plots will suggest whether service problems are occurring occasionally and ran-
domly, or whether overall service quality might be deteriorating. Although patient
comments and their visual representations are interesting and helpful to manage-
ment, the information is not statistically valid because, for one, the random-sample
requirement of most statistical techniques is not met.
The greatest disadvantage of comment cards is that many customers ignore
them and do not ll them out, so the cards received are not likely to be a true gen-
eral picture of the customers perceptions. Typically, only 5 percent of customers
346 Achieving Service Excellence
return comment cards, and they are usually either very satised or very dissatised.
It is difcult to know what percentage of the delighted total or the dissatised
total these responses represent. When the other 95 percent of customers say noth-
ing, the healthcare organization cannot determine if they were happy, unhappy, or
merely indifferent. Research shows that a large percentage of dissatised customers
ll out no cards, leave quietly, and never return.
Another major disadvantage of comment cards, and in fact of many methods
for acquiring feedback, is that the time lag between patient response and manage-
rial review prevents on-the-spot correction of service gaps and problems. Once the
moment of truth has passed and the angry or disappointed patient leaves after ex-
pressing negative responses on a comment card, the opportunity to recapture that
patients future business or loyalty is diminished.
Even worse, negative word-of-mouth advertising generated by dissatised pa-
tients cannot be corrected. Any time patients are asked to provide negative feed-
back, they must be assured that their identity will not be revealed to prevent any
kind of recriminations.
Surveys
Formal survey methods can obtain patient feedback about healthcare quality and
value. Although surveying is more expensive than the methods already discussed,
surveys can offer statistically valid, reliable, and useful measures of patient opinion
that the other methods cannot. Surveys can range in sophistication, precision, va-
lidity, reliability, complexity, cost, and difculty of administration.
Mail Surveys
Well-developed mail surveys, sent to an appropriate and willing sample, can pro-
vide valid information concerning patient satisfaction. Organizations can use mail
surveys to their benet, but many uncontrollable factors can inuence patient re-
sponses to a mail survey. Inaccurate and incomplete mailing lists or simple lack of
interest in commenting can produce a response rate too small to provide useful
information. In addition, the time lag between the experience and survey response
can blur a patients memory of details.
Mail surveys are usually used to generate reports that tend to be upwardly bi-
ased. The subtleties of the healthcare experience and patient perceptions cannot be
fully expressed numerically. Also, averages may not be sufciently informative. If
some patients remember an experience as terric and give it a high rating, while
others rate it as terrible, the numerical average will suggest that, on the average,
patient expectations were met.
Chapter 13: Measuring the Quality of the Healthcare Experience 347
The nature of medical treatment may also make interpretation of the ratings
difcult. If the operation was a success but the patient died, it would not matter
to the surveyed survivors that the rest of the patients experience was above expec-
tations. Finally, formal mail survey techniques are expensive because they require
proper questionnaire development, validation, and data analysis.
SERVQUAL
Several measures of service quality are available (see, for example, Castle 2007;
Gupta 2008; Marley, Collier, and Goldstein 2004). One well-accepted survey
technique is SERVQUAL (short for service quality), developed by Parasuraman
and his associates (Parasuraman, Zeithaml, and Berry 1988). SERVQUAL,
which has been extensively researched to validate its psychometric properties,
seeks to measure the way customers perceive the quality of service experiences
in ve categories:
1. Reliability: The organizations ability to perform the desired service
dependably, accurately, and consistently
2. Responsiveness: The organizations willingness to provide prompt service and
help customers
3. Assurance: The employees knowledge, courtesy, and ability to convey trust
4. Empathy: The employees ability to provide care and individualized attention
to customers
5. Tangibles: The organizations physical facilities and equipment and appearance
of personnel
SERVQUAL also asks respondents to rate the relative importance of the ve
areas, so organizations can make sure they understand what matters most to cus-
tomers. In each area, SERVQUAL asks customers what they expected and what
they actually experienced to identify service gaps at which organizations should
direct attention.
The SERVQUAL index was developed for the retail and other service indus-
tries. Ramsaran-Fowdar (2005) studied the SERVQUAL measures and identied
additional service dimensions relevant to healthcare, including core medical out-
comes (e.g., patient education, physician referral contacts) and professionalism
(e.g., knowledgeable and skilled support staff ).
SERVQUAL has been widely used in healthcare organizations (Rohini and Ma-
hadevappa 2006; Pakdil and Harwood 2005) with varying results (Dagger, Sweeney,
and Johnson 2007; Ramsaran-Fowdar 2005). An adaptation of the SERVQUAL
survey instrument, intended to evaluate service quality at Hallmark Hospital, is
presented in Exhibit 13.3.
348 Achieving Service Excellence
Exhibit 13.3 SERVQUAL Application to Healthcare: Measuring Customer Perceptions of
Healthcare Quality at Hallmark Hospital
, achi evi ng s ervi ce excel l ence
Figure 14.1 SERVQUAL Application to Healthcare: Measuring Customer
Perceptions of Healthcare Quality at Hallmark Hospital
DIRECTIONS: Listed below are five features pertaining to Hallmark Hos-
pital and the services it offers. We would like to know how important
each of these features is to you when you evaluate a hospitals quality.
Please allocate a total of 100 points among the five features according
to how important each feature is to youthe more important a feature is
to you, the more points you should allocate to it. Please ensure that the
points you allocate to the five features add up to 100.
1. The appearance of the hospitals physical facilities, equipment, and
personnel
________ points
2. The ability of the hospital to perform the promised service dependably
and accurately
________ points
3. The willingness of the hospital to help customers and provide
prompt service
________ points
4. The knowledge and courtesy of the hospitals employees and their
ability to convey trust and confidence
________ points
5. The caring, individualized attention the hospital provides to its customers
________ points
DIRECTIONS: Based on your experience with hospitals, please think
about the kind of hospital at which you would prefer to receive health-
care. Please show the extent to which you think such a hospital would
possess the feature described by each statement below. If you feel a fea-
ture is not at all essential for excellent hospitals such as the one you have
in mind, circle 1 for Strongly Disagree. If you feel a feature is absolutely
essential for excellent hospitals, circle 7 for Strongly Agree. If your feel-
ings are less strong, circle one of the numbers in the middle. There are
no right or wrong answers. All we are interested in is a number that truly
reflects your feelings regarding hospitals that would deliver excellent
service quality.
[The 22 survey items for this section are the same as those in the next section,
but without any reference to Hallmark Hospital.]
Fotter/book 8/12/02 3:47 PM Page 384
(Continued)
Chapter 13: Measuring the Quality of the Healthcare Experience 349
measuri ng the healthcare experi ence 385
Figure 14.1 (continued)
DIRECTIONS: The following set of statements relates to your feelings
about the service at Hallmark Hospital. For each statement, please show
the extent to which you believe Hallmark Hospital has the feature
described by each statement below. Once again, circling 1 means that
you Strongly Disagree that Hallmark Hospital has that feature, and cir-
cling 7 means that you Strongly Agree. You may circle any of the num-
bers in the middle that show how strong your feelings are. There are no
right or wrong answers. All we are interested in is a number that best
shows your perceptions about the service at Hallmark Hospital.
[On the instrument itself, the five category labels (Tangibles, etc.) will be
omitted.]
TANGIBLES
P1. Hallmark Hospital has modern-looking equipment
P2. Hallmark Hospitals physical facilities are visually appealing
P3. Hallmark Hospitals employees are neat-appearing
P4. Materials associated with the service are clean and sanitary at
Hallmark Hospital
RELIABILITY
P5. When Hallmark Hospital promises to do something by a certain
time, it does so
P6. When you have a problem, Hallmark Hospital shows sincere inter-
est in solving it
P7. Hallmark Hospital performs the service right the first time
P8. Hallmark Hospital provides its services in the way it promises to do so
P9. Hallmark Hospital insists on error-free service performance
RESPONSIVENESS
P10. Employees of Hallmark Hospital tell you exactly when healthcare
services will be performed
P11. Employees of Hallmark Hospital give you prompt healthcare service
P12. Employees of Hallmark Hospital are always willing to help you
P13. Employees of Hallmark Hospital are never too busy to respond to
your requests
Fotter/book 8/12/02 3:47 PM Page 385
Exhibit 13.3 (continued)
350 Achieving Service Excellence
Although tangibles refer primarily to the setting and to the physical
elements of the delivery system, and reliability reflects a combination
of organizational delivery system design and service provider ability,
the remaining three elements-responsiveness, assurance, and empa-
thy-are almost exclusively the responsibility of the patient-contact
employees.
Assessing Internal Customers
Healthcare organizations too often overlook internal customers when
they assess external customers. Many units within traditional full-serv-
ice healthcare facilities provide service functions for other internal units
either in addition to services for patients and external physicians or as
standalone functions (i.e., human resources, training, and payroll).
These internal service providers are often thought of as overhead activ-
ities rather than service providers with customers. As a result, many
healthcare executives pay little attention to these activities.
,o achi evi ng s ervi ce excel l ence
Figure 14.1 (continued)
ASSURANCE
P14. The behavior of Hallmark Hospital employees instills confidence in
customers
P15. You feel safe in going to Hallmark Hospital and doing business with
them
P16. Employees of Hallmark Hospital are consistently courteous to you
P17. Employees of Hallmark Hospital have the knowledge to answer your
questions
EMPATHY
P18. Hallmark Hospital gives you individual attention
P19. Hallmark Hospital has visiting hours convenient to all its customers
P20. Hallmark Hospital has employees who give you personal attention
P21. Hallmark Hospital has your best interests at heart
P22. Employees of Hallmark Hospital try to learn your specific needs
Source: Adapted with permission from SERVQUAL: A Multiple-Item Scale for
Measuring Consumer Perception of Service Quality, by A. Parasuraman, V. A. Zeithaml,
and L. L. Berry. 1988. Journal of Retailing 64 (1): 3840.
Fotter/book 8/12/02 3:47 PM Page 386
Exhibit 13.3 (continued)
The SERVQUAL instrument reects a point we have made throughout: the
importance of the patient-contact staff to healthcare quality. Although tangibles
refer primarily to the setting and to the physical elements of the delivery system,
and reliability reects a combination of organizational delivery system design and
service provider ability, the remaining three elementsresponsiveness, assurance,
and empathyare almost exclusively the responsibility of the patient-contact em-
ployees.
Internal Customer Metrics
Healthcare organizations too often overlook internal customers when they assess
external customers. Many units within traditional full-service healthcare facilities
provide service functions for other internal units in addition to services for patients
and external physicians or as stand-alone functions (i.e., human resources, train-
ing, and payroll). These internal service providers are often thought of as overhead
Chapter 13: Measuring the Quality of the Healthcare Experience 351
activities rather than service providers with customers. As a result, many healthcare
executives pay little attention to these activities.
One hospital developed and implemented an internal customer survey in-
strument (Smith et al. 2007). This process included (1) an initial baseline survey
of service managers concerning their satisfaction with internal nursing services,
(2) feedback to service-area managers regarding the survey results, (3) an interim
survey to determine improvement, and (4) a resurvey two years later to determine
effectiveness of the implemented changes. In general, the scores in the initial sur-
vey were highly positive. Of the 15 areas, 13 received favorable composite scores
and 11 received mean scores stronger than the agree category of 3.0.
After reviewing the results of the initial survey, senior nurse managers used
the results as a baseline for service improvement. The service-area nurse managers
picked three specic problems identied in the survey and then developed and
implemented plans to address those problems. Most of the nurse managers then
solicited staff input on these action plans. After two years, the satisfaction levels
of the customers (users of nursing services) showed that all 15 service areas were
received favorably and 14 of the 15 areas had mean scores greater than 3.0.
Researcher Ben Schneider has developed another widely used questionnaire
that seeks to assess the degree to which employees perceive a climate of service.
In a number of published studies, Schneider and colleagues have found a consis-
tent relationship between employee assessments of a positive service climate and
customers perceptions of the positive service experience (Schneider, Macey, and
Young 2006; Schneider and White 2004). Clearly, a link exists between the em-
ployee propensity to deliver excellent customer service and the actual delivery of
service quality.
Structured Personal Interviews
Face-to-face patient interviews provide rich information when trained interview-
ers, who are able to detect nuances in responses to open-ended questions, have the
opportunity to probe patients for details about their experiences. Interviewing can
uncover previously unknown problems or new twists to a known problem that
cannot be uncovered in a preprinted questionnaire or reected well in numerical
data.
However, personal interviews are costly: Interviewers must be hired and trained,
interview instruments must be custom designed, and inconvenienced patients
must be compensated for participating. Without incentives, most patients see little
352 Achieving Service Excellence
personal benet from participating in a patient interview unless they are either very
satised or very dissatised. Finally, the most desirable time to interview patients
and/or their families is at the conclusion of the healthcare experience. Getting their
attention and cooperation when they are anxious to leave is a challenge.
Another patient-interview approach is to employ consultants or employees
(called lobby lizards in the hotel business) to ask randomly selected patients their
opinions on several key service issues. In a healthcare facility, the person conduct-
ing the customer interviews is typically a manager or another patient-contact em-
ployee. For example, a billing clerk may have the best opportunity to question
patients about their experience as they are leaving the clinic, ofce, or hospital and
making their payment. Because patients may not always be motivated to tell the
whole truth, a systematic interview should pose questions that are professionally
developed and validated to help ensure that the information gathered is useful, ac-
curate, and sufcient.
As mentioned earlier, one advantage of acquiring immediate feedback is that it
may allow prompt recovery from service problems. Staff training should therefore
include appropriate service-recovery techniques, as research conrms that the or-
ganization benets greatly from soliciting and fairly resolving patient complaints.
Because service-quality information derived directly from the patient is highly be-
lievable to staff and management, it motivates a serious consideration of the prob-
lems the patients identied.
Critical Incidents
Another important survey tool is the critical incident technique. Through inter-
views or paper-and-pencil surveys, customers are asked to identify and evaluate nu-
merous momentsclassied as dissatisers, neutral, or satisersin their interac-
tions with the organization. The survey lets the organization know which moments
are critical to customer satisfaction, and the critical dissatisers can be traced back
to their root causes and rectied. The Malcolm Baldrige report of Mercy Health
System, for example, discusses the importance of the organizations critical mo-
ments of service. These events are considered key to providing patient satisfaction
and are monitored closely and updated often.
Knowing which incidents in the hospital stay are critical to patients allows the
organization to concentrate on making them smooth and seamless (Mercy Health
System 2007). In healthcare, the critical incidents tend to be related to customer
expectations (discussed earlier) such as patients concerns about personalized care,
prompt attention, staff respect, physician and staff competence, a clean environ-
Chapter 13: Measuring the Quality of the Healthcare Experience 353
ment, privacy, and clear information. Information related to these critical incidents
will generate usable information for service improvement.
Telephone and Web-Based Surveys
Telephone interviews are another useful method for assessing customer percep-
tions of service. A review of the Malcolm Baldrige award winners reveals a com-
mon use of these surveys. Many use commercial providers like Press Ganey or
Gallup to gather this information, and others, such as Sharp HealthCare and
Mercy Health System, collect these data monthly. Many healthcare facilities use
telephone surveys to follow up with patients a week after the service was pro-
vided rather than having them complete a written survey at the time of the
service. More recently, healthcare organizations have started sending patients e-
mails with hot links to an Internet survey as a less expensive and less intrusive
substitute for telephone surveys.
Although telephone interviews or Web surveys eliminate the inconvenience of
gathering information while patients are still in the healthcare facility, they present
other challenges. Survey methods rely on retrospective information that can be
blurred by the passage of time. If the service received was too brief or insignicant
for patients to recall accurately, or if patients have no special motivation to partici-
pate, the information they provide is likely to be unreliable or incomplete.
In addition, in this age of intense e-mail and telephone solicitations, custom-
ers often regard telephone and Web-based surveys as intrusions on their time and
violations of their privacy. Annoyed respondents feeling resentment toward the
organization for calling them at home are likely to bias the data.
Red Lobster and Steak & Ale avoid some of these difculties by building into
their customer meal-checks system a code that prints an 800 telephone number for
every nth customer to call; the automated response system then asks customers to
press touchtone buttons to answer questions about their experience at the restau-
rant. In return for participation, the restaurant offers coupons for free desserts or
two entrees for the price of one on the customers next visit. Healthcare providers
can adopt this strategy by inviting patients to participate in a survey. Participants
names are then entered into a rafe to win health-related enticements such as free
family passes to a gym or multiplex.
Because telephone interviews conducted by a trained interviewer are expensive,
Web-based surveys are preferred. When data analysis and expert interpretation are
included, the total cost for a statistically valid telephone survey can be high, whereas
many Web-based tools offer automatic data analysis and are far less expensive.
354 Achieving Service Excellence
Mystery Shoppers
Mystery shoppers provide management with an objective snapshot of the health-
care experience. While posing as patients, these trained observers methodically
sample the service and its delivery, take note of the environment, and then compile
a systematic and detailed report of their experience. They can sample the admis-
sions process or an overnight stay at a hospital or a routine checkup at a freestand-
ing clinic.
Mystery shopper reports generally include numerical ratings of many aspects
of an experience. These ratings then allow organizations to compare results before
and after an improvement is instituted. Mystery shoppers may also be directed to
observe competitors in the market, gathering information about the competitions
quality level, program/service offerings, facilities, staff performance, and prices.
Organizations may hire a commercial service, a consultant, an actor, or even a staff
member to conduct a mystery-shopper visit (Buckley and Larkin 2007).
Generally, employees know that their organization uses mystery shoppers, but
they do not know who the shoppers are or when they will appear. Because these
visits are unannounced, employees cannot prepare or dress up their performance.
Shoppers can be instructed to show up at random times during various shifts to
assess differences in quality and value on different oors, conditions, employees,
and managers (Van der Wiele, Hesselink, and van Iwaarden 2005).
One of the most important benets of a mystery shopper program is that it pro-
duces information that can assist managers in identifying performance decien-
cies that call for employee coaching. Employees may discount or feel antagonistic
and defensive about supervisory feedback, making them reluctant to express their
need for coaching or to follow through on manager-recommended improvements.
Mystery-shopper observations spell out these needs, enabling the manager to use
the customers voice to coach employees.
An article in the Wall Street Journal reports that mystery shoppers in healthcare
may make various inquiries over the phone, go to a doctors ofce or an emergency
department for a checkup, or even fake symptoms (Wang 2006). Generally, they
pose as uninsured patients. Mystery patient reports lead to improvements, ranging
from placing signage throughout the facility to training staff to empathize better
with patients.
Mystery shoppers test the staff s ability to respond to anticipated service prob-
lems and service delivery failures. For example, shoppers can create a problem or
intensify a situation by asking certain questions or requesting unique services to as-
sess employee responses under pressure. The Wall Street Journal article reports one
shoppers experience when she asked for an extra pillow: The nurse told her to send
Chapter 13: Measuring the Quality of the Healthcare Experience 355
her husband to the dollar store to buy one. Mystery shoppers can also gauge the
effectiveness of a particular training program by shopping at a healthcare organiza-
tion before and after the training (Wang 2006).
The main disadvantage of a mystery shopper is the small size of the sample from
which the shopper generates reports. Because anyone can have a bad day or a bad
shift, a mystery shopper may base conclusions on unusual or atypical experiences.
One or two observations are not a statistically valid sample of anything, but hiring
enough mystery shoppers to yield a valid sample is impractical and expensive.
Further, the unique preferences, biases, or expectations of individual shoppers
can unduly inuence a report. Well-trained shoppers with specic information
about the organizations service standards, instructions on what to observe, and
guidelines for evaluating the experience avoid this pitfall.
However, a healthcare mystery shopper can only sample so many aspects of the
healthcare experience. A mystery shopper cannot go through a surgical procedure,
for example. Two other negatives are that the staff are spending time on a patient
who is not really in need of medical service and that seeking treatment that is not
needed may be unethical.
PUBLI C METRI CS
One of the fastest-growing trends in measuring patient quality are those metrics
provided by governmental or external organizations. For example, the University
of Michigans American Customer Satisfaction Index (ACSI) includes several cat-
egories for healthcare. Interestingly, of the services ACSI measures, ambulatory
care scores the highest, with an 81 rating out of a possible 100. In Great Britain,
the National Health Commission publishes an assessment of healthcare providers
that uses patient assessment of their satisfaction for nearly 10 percent of the total
score.
As mentioned in Chapter 10, many websites can help healthcare consumers
gauge the service quality of hospitals, nursing homes, long-term care providers,
and other organizations; see, for example, www.hospitalcompare.hhs.gov or www.
leapfroggroup.org. Consumer Reports rates the service quality of hospitals by state,
assessing aspects as how well doctors communicate and how attentive the staff are.
Magazines, such as U.S. News and World Report, rank healthcare organizations on
the basis of customer feedback and reported clinical outcomes.
Finally, many regional and state organizations and governments collect and
make available data on various healthcare providers, from hospitals to long-
term care and nursing home facilities to individual physicians. The point is
356 Achieving Service Excellence
that a wide variety of metrics can be used, and healthcare managers should be
aware of those that can provide feedback metrics to staff and serve as bench-
marks against which the organizations performance levels can be consistently
and accurately assessed.
DETERMI NI NG THE MEASURE THAT FI TS
What gets measured gets managed and hopefully improved, but determining which
measure is most appropriate to use is another challenge. A major hospital in a for-
prot chain, for example, may require more elaborate and expensive strategies to
measure feedback because poor service can harm the reputation and bottom line
of the hospital, the chain with which the hospital is afliated, and the livelihood of
countless employees up and down the line.
The value to this hospital of nding and correcting service problems so that
it can deliver the healthcare quality its patients expect is tremendous. Failing to
meet patient expectations will quickly make it and everything afliated with it
uncompetitive in a dynamic marketplace. On the other hand, the ofce of a small
independent physician who has a well-established reputation for providing superb
clinical treatment in a caring manner may learn just as much from asking patients
about their experience without incurring the expense of sophisticated quality as-
sessment methods.
Costs and level of expertise used to gather data vary also. An important ques-
tion to ask is who should collect data: employees, consultants, or a professional
survey research organization. Using staff members is the least expensive alternative,
but they also have the least expertise in customer service research and may lack the
communication skills to interview effectively. Consultants and survey organiza-
tions cost more, but they are better able to gather and interpret more detailed,
sophisticated statistical data using more sophisticated techniques. For example,
employee surveyors cannot measure eye-pupil dilation, but professionals can.
Regardless of the evaluation technique selected to measure healthcare quality,
one thing is certain: Patients evaluate service every time it is delivered, and they
form distinct opinions about its quality and value. All healthcare organizations that
aspire to excellence must constantly assess the quality of their healthcare experience
through their patients eyes. Most patients and their families are happy to tell what
they thought about their experience if they are asked in the right way at the right
time. Telephone surveyors calling on Friday night during dinner time will get the
turndown they deserve, but a comment card left in a patient room to be turned
Chapter 13: Measuring the Quality of the Healthcare Experience 357
in upon discharge will get far better attention. Healthcare managers striving for
excellence need to ask the right questions at the right time, of the right mix of pa-
tients, to obtain the information necessary to ensure service that meets and exceeds
patient expectations.
Irrespective of whether qualitative or quantitative assessment methods are used
or which particular methods are used alone or in combination, follow-up is crucial.
If internal or external customers provide data to organizations that they perceive to
be unresponsive to their input, the quantity and quality of future input will be lim-
ited. Why provide new data if old data are ignored? Not collecting customer infor-
mation is better than collecting and ignoring the information. Follow-up should
include communicating to staff clear and accurate economic measures of loss from
the defection of one customer, setting service standards based on customer expecta-
tions, eliminating substandard performance and performers, and communicating
with both patients and staff about how their input has led to service improvements
(Albrecht and Zemke 2002).
CONCLUSI ON
Numerous methods are available for measuring the degree to which service excel-
lence is achieved. Each healthcare organization needs to assess which methods will
work best for its own situation. Each organization also needs to determine whether
to gather data using its own resources or contract the function to an outside group.
The degree of sophistication required and the organizations internal resources will
drive this decision.
Regardless of whether the organization uses qualitative or quantitative measures
(or both) or internal or external resources to generate the data, the purpose of col-
lecting data on service quality should be to enhance customer service. Once base-
line information is established, the organization can focus on setting performance
standards for a few critical areas at a time and spend several months achieving
service excellence. Staff will not be overwhelmed, managers will be able to monitor
a manageable number of critical areas, and everyone will be able to learn together
and support each other in the process. Once the original areas are improved, the
organization can take on additional areas.
A major challenge is how to achieve and maintain continuous improvement.
One approach is to celebrate individual and group success in achieving service ex-
cellence. Staff need and want to be appreciated for their achievements and contribu-
tions. Among the more successful celebration methods are mentions in newsletters,
358 Achieving Service Excellence
posting positive letters about employees on bulletin boards, sharing stories of excel-
lent service at staff meetings, and sending thank you notes. Every meeting should
be viewed as an opportunity to teach, positively reinforce, and celebrate successes
in achieving customer satisfaction. This process should be continuous.
Service Strategies
1. Focus on the quality and outcomes of both clinical service and customer
service.
2. Be aware that if you do not measure it, you cannot manage it; if you do
not manage it, you cannot improve it.
3. Use the best combination of qualitative and quantitative methods to
measure customer satisfaction.
4. Balance the value of service information obtained from patients with the
cost of obtaining it.
5. Recognize the strengths and weaknesses of the available assessment
techniques.
6. Offer service guarantees.
7. Assess the quality of service for both internal and external customers.
8. Follow up on implementation of service improvement ideas generated
from all quality assessment methods.
9. Get better or get beaten in the competitive healthcare marketplace.
10. Maintain momentum for customer service by continually using positive
reinforcement and celebrating successes.
359
Those who enter to buy, support me. Those who come to atter, please me.
Those who complain, teach how I may please others so that more will come.
Only those hurt me who are displeased but do not complain.
Marshall Field, department store magnate
C H A P T E R 1 4
Fixing Healthcare Service Failures
Service Principle:
Eliminate all sources of disappointment positively and quickly
Every customer assumes that the service she pays for will, at the least, meet
her expectations. For example, a patient who makes an appointment for a lab test
expects the appointment will be kept when she arrives and the test will be done
properly. If the initial expectations are met, the patient is satised. If the initial
expectations are exceeded, the patient is delighted and willing to return when the
need arises. Exceeding patient expectations creates apostles and evangelists
happy customers who spread positive word of mouth to their family, friends, and
associates about the excellent total healthcare experience they received. Such favor-
able words reinforce the provider organizations public image and reputation.
What happens, however, if the patients initial expectations go unmet? For
example, when the patient arrives for his scheduled appointment, the reception-
ist informs him that he needs to reschedule because the doctor cancelled her ap-
pointments for the day or a machine or equipment is malfunctioning. This pa-
tient will feel dissatised at best, and at worst, the patient will turn into an angry
avengeran unhappy customer who bad-mouths the organization to family,
friends, and anyone else who will listen. A typical dissatised patient may tell eight
to ten people about the problem he encountered, but an avenger will likely create
a website to share his disappointment with millions of people.
Service failures, like clinical errors, are inevitable. Many healthcare organiza-
tions do plan well for clinical problems, but they do not anticipate service prob-
lems with the same care. They incorrectly assume or hope that the service will be
available as promised, the setting and delivery system will function as designed,
and the staff will perform as they were trainedconsistently, every time.
360 Achieving Service Excellence
Well-managed organizations, however, work hard to identify, plan for, and pre-
vent all types of service failures, and they understand that these problems vary in
frequency, timing, and severity. Not meeting patient expectations can occur any
time during a single healthcare experience or across multiple experiences with the
same organization. Because rst impressions are so important, a problem that takes
place early in the process will weigh more heavily on the patients mind than a
problem that occurs later. Big errors count more than little ones.
Customers have more tolerance for poor service than for poor service recovery
(Michel, Bowen, and Johnston 2008). If a customer experiences a second fail-
ure of the same service, no recovery strategy can work well; in all likelihood, that
customer will be lost forever. Furthermore, Michel, Bowen, and Johnston (2008)
suggest that a customer is most annoyed and angered not by her dissatisfaction
with the service but by her belief that the system that caused the failure remains
unchanged and thus will lead to more failure. In other words, customers are turned
off by an organization that is so indifferent to its service quality that it does not
make the effort to learn from its mistakes.
Learning from failures is more important than simply xing problems because
learning results in process improvements. Improvements, in turn, have a direct
impact on the bottom line, as they reduce costs of service errors, boost employee
efciency and morale, and increase customer satisfaction. Although many hospitals
have instituted procedures for handling patient complaints in response to accredi-
tation requirements, they do not formally track or capture complaints for learning
and improvement purposes (Donnelly and Strife 2006).
In this chapter, we address the following:
The importance of fnding and fxing service failures
The reasons such failures occur
Strategies for service recovery and service failure prevention
Ultimately, if the organization neglects to respond to a service problem, it fails
twice, not once: First, it did not meet the most basic customer expectation; second,
it did not resolve, quickly and appropriately, the problem caused by the rst.
ELEMENTS OF A SERVI CE FAI LURE
Despite the best-laid plans, service failure is a reality in all organizations. Complex
organizations function as a system, with interdependent and tightly intertwined
parts. One mistake in one part will affect the rest of the system, and the tighter the
Chapter 14: Fixing Healthcare Service Failures 361
intertwining of these parts, the more susceptible the whole system is to disaster.
The difference between an excellent and a poor service organization, however, is
that the best one works hard not only to remedy failures but also to prevent them
from occurring at all. Service failures occur for two reasons: human error and sys-
tem error, which are discussed in the following section.
Sources
Providers can fall short of a patients expectations at any point in the healthcare
experience. The product, setting, or delivery system may be inadequate or inap-
propriate, or the staff may perform or behave poorly.
For example, if the patients teeth do not look as white as she expected when she
walks out of the dentists ofce, she will be dissatised and a service failure could
result. Similarly, if the patients lab test takes several hours to complete, instead of
the one-hour time frame he was promised, he will deem the experience a failure.
The environment or setting can also cause service failures. If the patient thinks the
ambient temperature is too cold, the smell of antiseptic too strong, the exam or
waiting rooms too dirty, or the parking lot too dark and too far away, she will feel
unhappy about these failures. Certainly, staff can bring about service failures if they
are unfriendly or rude, poorly trained or inexperienced, and not forthcoming with
information or misinformed. The service product, setting, delivery system, and
staff must be carefully managed to minimize the likelihood of a service failure.
Magid and colleagues (2009) illustrate some organizations failure in managing
their services. These researchers surveyed 3,562 emergency medicine clinicians in
65 hospitals. The majority of the respondents said their emergency department
(ED) lacks sufcient space in which to deliver patient care, and one-third said the
number of patients who presented in the ED consistently exceeds their capacity
to provide safe care. On the stafng front, two-thirds reported that the number
of nursing staff is insufcient to handle patient loads during busy periods, and 40
percent said they do not have enough doctors to handle patient loads when the ED
gets busy.
Taylor, Wolfe, and Cameron (2002) looked at the same ED issues but from
the patient perspective. These researchers found 1,141 problems were related to
patient treatment, including inadequate treatment and diagnosis; 1,079 prob-
lems were related to communication, including poor staff attitude, discourtesy,
and rudeness; and 407 problems related to delay in treatment (Taylor, Wolfe, and
Cameron 2002).
362 Achieving Service Excellence
Patients Role
Service failures come in different degrees, ranging from catastrophies (which
make the newspaper headlines) to minor slipups (which happen behind the
scenes and patients never know about). Along this continuum are an infinite
number of mistakes. Because the patient defines the quality of the service
experience, the patient also defines the nature and severity of each service fail-
ure. Two patients dissatisfied about the same failure can have different degrees
of unhappinessone can be very unhappy, while the other can be mildly
unhappy.
Sometimes, the organizations product, setting, delivery system, or staff
may not be the cause of the disappointment; the patient may be at the root of
the problem. For example, a plastic surgeon performs a facelift as expected and
requested by the patient, but the patient may still deem the operation a failure
simply because she does not like the way her new face looks. The patient who
ignores warning signs or fills out forms incorrectly also contributes to service
failures. Other examples include patients who act belligerently toward staff
and other patients and those who sabotage their own care by refusing to take
their medication or follow their doctors orders. These service failures are not
initiated by the organization and are often beyond its capability to manage,
but the organization must still anticipate, address, and prevent them as well
as possible.
It is human nature to attribute successes to ourselves and problems to oth-
ers. Thus, patients often point their ngers at someone else when a service
failure occurs. Organizations that want to keep patient-caused problems from
destroying the patients healthcare experience and his feeling of goodwill to-
ward the enterprise develop and use certain strategies (such as the following)
designed to help the patient recover from the failures he created without mak-
ing him feel foolish or blamed:
Distribute a heart-healthy or calorie-restricted menu to patients who refuse
to abide by dietary orders.
Provide clear, simple care instructions to family members about the patients
care.
Offer assistance with flling out forms.
Make warning and directional signs bigger, bolder, and in languages
understood by the primary service population (e.g., English, Spanish,
Chinese, Polish, Arabic).
Chapter 14: Fixing Healthcare Service Failures 363
Customer Defection
Patients want an active, interested, positive attitude from their providers. They will
not buy into television, print, Internet, or billboard ads that tout the excellence of
an organization if they have experienced the opposite.
Customer defectionleaving one provider for anothercan be prevented by
ensuring that the total healthcare experience is excellent in the rst place and, if a
service failure occurs, by immediately putting a solid service recovery plan to work.
According to Reichheld and Sasser (1990), just a 5 percent reduction in customer
defection rate can raise prots by 25 to 85 percent. Clark and Malone (2005) sug-
gest a similar increase in prots and customer retention as a result of successfully
addressing customer complaints.
Usually, a service recovery effort yields one of three outcomes:
1. The problem is xed, and the formerly unhappy patient is now happy.
2. The problem is not xed, and the formerly unhappy patient remains unhappy.
3. The problem is xed but not satisfactorily or completely, and the formerly
unhappy patient has made concessions with the organization and is now
neutralneither happy nor unhappy.
As described earlier, happy patients may become apostles or evangelists,
while unhappy patients may turn into avengers. Neutral patients, on the other
hand, may forget the whole experience and, as a result, the organization as well.
In extreme cases, such as medical catastrophes, neutralizing the unhappy pa-
tient may be the best outcome the organization can reach. For example, if a patient
develops an infection after a successful operation, all the organization can do to
neutralize the patients level of dissatisfaction is to ensure that all aspects of the
hospitalization is as patient-centered and error-free as humanly possible. Here, the
goal is to somehow offset the adverse event with service excellence. Even if that
goal is achieved, the patient will still leave feeling neutral and will likely defect to
another provider the next time around.
Furthermore, neutral customers are inuenced by other factors. A recent study
of insurance providers indicates that a patients switching behavior (or customer
defection) is primarily a function of three factors (QMS Partners 2009):
1. Name recognition or lack thereof
2. Stability of the provider
3. Efciency with which billing complaints are handled
364 Achieving Service Excellence
The third factor implies that healthcare consumers highly value the way they are
treated by the organizations employees. A service failure in the people part of the
healthcare experience can make the difference between customer loyalty and cus-
tomer defection.
The Impact of Evangelists and Avengers
According to Sherman and Sherman (1998), 1 avenger tells his unfortunate expe-
rience to at least 12 people. Each of those 12 then shares the story to 5 or more
people. On average, an avenger has an audience of about 72 people. Furthermore,
if 8 avengers each spreads the disappointing news to 12 others, each of whom in
turn tells 5 of their associates, then 576 people hear the negative word of mouth
that only 8 patients actually experienced. A simpler calculation is this: Each dissat-
ised customer sends out, verbally or in writing, about 70 negative messages.
Conversely, evangelists do not talk about their positive experience as widely as
avengers do. Evangelists share their good stories to approximately 6 other people
(Hart, Heskett, and Sasser 1990).
DI SSATI SFI ED CUSTOMER S RESPONSES
Unhappy patients react in one or a combination of three ways: never return, com-
plain, and bad-mouth the organization.
Never Return
A dissatised patient vows to never return to the same provider. This is the worst
customer reaction for an organization because it also means the angry patient will
tell others about the negative experience. In this situation, the organization loses
not only the current business of this patient but also the future business of all the
people the patient can inuence. Service recovery should be especially focused on
this group of unhappy customers.
Complain
Benchmark organizations encourage patients and other customers to complain,
and they thank them for it. A complaint should be viewed as an opportunity, not
Chapter 14: Fixing Healthcare Service Failures 365
a challenge, because it gives the organization a chance to rene the system and
make customers happy. Patients who complain either verbally or in writing allow
employees and managers to x the problem before the problem and the dissatisfac-
tion are shared with others.
Organizations may also teach patients to complain, if necessary, as detailed
complaints function as feedback that can be measured and monitored over time.
Complaining patients are less likely to defect to another provider and to bad-
mouth the organization than those who do not express their dissatisfaction to the
organization. Making sure no customer leaves unhappy is obviously advantageous
to any organization. The best way to ensure this is to seek out patient complaints
before they leave the hospital, clinic, or ofce.
The results of a landmark study conducted by the Technical Assistance Research
Program (TARP 1986) for the U.S. Ofce of Consumer Affairs strongly suggested
that customers who complain are more loyal than those who do not and that hav-
ing complaints satisfactorily resolved increased the customers brand loyalty. These
customers were happier with the organization after experiencing bad service than
before because the dissatisfaction led to improvement. Research conducted on the
relationship between customer loyalty and complaints since this TARP study has
conrmed these ndings from more than two decades ago.
Bad-Mouth the Organization
If the negative experience is costlynancially and/or personallythe patient is
more likely to spread the bad word. The greater the cost to the patient, the greater
the motivation to tell. People who hear such negative stories will be discouraged to
patronize the same provider, if given a choice.
Angry customers (avengers) who used to be limited to writing letters to corpo-
rate headquarters or the Better Business Bureau, putting up signs in their yard, or
painting lemon on the car now have a more powerful tool: the Internet. For a
minimal fee, anyone with Internet access can create a website or a blog to tell the
world about an offending company and also invite others to share their stories of
poor treatment. In this day of instant and global communication, a bad-mouther
can spread the message to millions of people; the same is true of evangelists.
Word of mouth is important for several reasons. Friends, family, colleagues,
and other associates tend to be more credible sources than impersonal testimonials
(Lake 2009). When a friend reports that a certain physician is cold and uncaring,
you no longer believe or are at least wary of the advertisements that promote the
366 Achieving Service Excellence
warm and personal touch of that physician. Personal accounts, either good or
bad, from friends and family are also more vivid, more convincing, and more com-
pelling than any paid commercial advertising.
Dollar Value of Customer Dissatisfaction
Customer defection and negative word of mouth create an expensive problem for
the organization. Over time, the loss of revenue from a patient who opts never to
return and from potential customers who listened to the unhappy patients bad-
mouthing is tremendous. Because that dollar value is so high, hardly any effort to
x a service failure is too extreme.
Consider these numbers that illustrate the point. Suppose the average person is
admitted into the hospital three times over her lifetime, and the average hospital
bill for one stay is $15,000. For Patient A, who vowed never to return to and has
bad-mouthed the hospital, the lifetime revenue loss sustained by the hospital is
$45,000. If Patient A is married and has two children, the lifetime family revenue
loss rises to $180,000. If the bad-mouthing damage is calculated (Patient A tells 12
others, according to calculations by Sherman and Sherman [1998]), the lifetime
loss could reach $540,000 ($45,000 12) at a minimum.
A similar type of calculation can be done for a managed care organization that
lost a multiyear contract with one dissatised employer that represents 300 covered
lives. Lets assume annual premiums of $3,000 per enrollee over a ve-year con-
tract. The cost of this loss is $4.5 million (300 $15,000 = $4.5 million). Simi-
larly, a physicians defection from a hospital, assuming he brought in 2 admissions
per week for 45 weeks a year, will result in a $1.35 million loss (90 $15,000 =
$1.35 million).
To make these gures meaningful to employees, the nancial loss can be calcu-
lated at the department levelthat is, what dollar amount is associated with the
defection of one nurse? Such calculations can also lead to some surprisingly large
numbers for even a small business. To show how a dentist might come up with
numbers like these, assume that the dentists satised patients come in for treat-
ment twice a year and spend an average of $150 each time. The total value of each
satised biannual patients business for the next ve years is $1,500. Conversely,
positive word of mouth from happy patients can bring in enormous numbers in
potential revenues.
The point of this exercise is simple: The long-term cost of patient defection
and negative word of mouth is usually much more than the expense of correcting
a service failureimmediately and appropriately.
Chapter 14: Fixing Healthcare Service Failures 367
SERVI CE RECOVERY
An organizations attempt at service recovery can make a positive or negative im-
pression on the patient who experienced a service failure (Berry 2009). A small
problem can turn big if the effort is half-hearted, misguided, or too little too late. A
big problem minimized or eliminated, on the other hand, becomes a great example
of customer service that must be shared with the rest of the organization.
In addition, the way an organization responds to complaints and service fail-
ures, whether well or poorly, communicates how committed it is to patient satisfac-
tion. Similarly, the way an organization seeks complaints and service failures sends
a loud message about what it truly believes in. Compare the following hypothetical
organizations.
Hospital A is defensive about patient complaints and keeps them secret (al-
though employees usually hear about them anyway), resolves problems as cheaply
and quietly as possible, and seeks people to blame for the complaints. Hospital B,
on the other hand, aggressively looks for and xes service failures, disseminates nd-
ings about complaints and failures throughout the organization, makes quick and
fair adjustments and improvements, and seeks solutions rather than scapegoats.
Which of the two organizations provides better customer service?
Some companies claim strong nancial benets from successful complaint reso-
lution. According to Sherman and Sherman (1998), even if a service failure occurs,
about 70 percent of the patients affected will continue to do business with the pro-
vider if their issues are resolved eventually; that percentage jumps up to 95 if the is-
sues are resolved on the spot. This nding translates into large sums of money over
the lifetime of these patients and their families and friends. Such data motivate
benchmark healthcare organizations to engage their frontline employees in han-
dling service complaints and problems. These organizations empower employees
to address the failures quickly and in whatever way they see t, without manager
authorization or approval. Hart, Heskett, and Sasser (1990) agree: The surest way
to recover from service mishaps is for workers on the front line to identify and solve
the customers problem.
Complaints and Other Service Failure Data
Most organizations generally obtain and study only a fraction of the service failure
data collected from customers, employees, and managers. Even when managers
agree that customer feedback is essential, often that information does not ow
from the division that gathers and addresses it into the rest of the organization
368 Achieving Service Excellence
(Michel, Bowen, and Johnston 2008). Also, most rms fail to document and
categorize complaints adequately, which makes it more difcult to learn from
mistakes (Tax and Brown 1998).
Research indicates that the more negative feedback a customer service depart-
ment collects, the more isolated that department becomes because it does not want
to be seen as a source of friction. Some service recovery units soak up customer
complaints and problems with no expectation of feeding this information back to
the organization. Other organizations actually impede service recovery by reward-
ing low complaint rates and then assuming that a decline in the number of com-
plaints signies an improvement in customer satisfaction.
Employee attitudes (positive or negative) about management spill over to the
way they treat patients and other customers. Positive attitudes result when em-
ployees believe that management provides them with the means and the support
to handle service failures. When employees believe otherwise, they tend to think
they are being treated unfairly and display passive and maladaptive behaviors that
can sabotage customer service. At organizations that reward low complaint rates
or punish/blame employees for service failures, employees may send dissatised
customers away instead of keeping them by apologizing and addressing the issue,
which employees most likely created.
SERVI CE RECOVERY STRATEGI ES
Berry (2009) argues that the organization should always apologize for service fail-
ures, but an apology alone is seldom sufcient. Three major strategies are available
for dealing with service failures:
1. Proactive or preventive strategies for identifying problems before they happen;
these strategies are built into the design of the service, employee training, and
the delivery system
2. Process strategies for monitoring the critical moments of the service delivery
3. Outcome strategies for seeking out problems after the service experience has
happened
Preventive Strategies
Preventing problems is easier and less costly than recovering from them. Proactive
strategies are designed to identify and x any trouble spots before they become a
service failure.
Chapter 14: Fixing Healthcare Service Failures 369
Forecasting and Managing Demand
If a statistical prediction of patient demand on a particular day indicates that the
hospital will be full, then a preventive strategy is to schedule full staff on each shift,
make extra supplies available, and prepare departments for full capacity. The same
strategies could work for a physician practice that is anticipating a lot of patient
visits on a given day. An appointment system may help manage the expectation of
patients, and sufcient staff and supplies can be made available.
If the organization plans poorly, and patients have to wait longer than they feel
is appropriate, their perception of the overall quality of their service experience
declines rapidly, and a service failure results. Keeping the wait time short avoids
this type of failure.
If demand can be forecasted for a longer period, then other proactive strategies
can be implemented. For example, if demand in two years is expected to increase
by 20 percent, new capacity should be built, new employees should be hired and
trained, and inventories should be increased to prevent the occurrence of long
waits, unavailable supplies, or insufcient and untrained staff. Even if major steps
(hiring more staff, building new capacity) cannot be taken because of limited re-
sources, employees may be trained to cope with demand surges. Just as hospitals
run disaster drills with re-and-rescue teams, so too can hospitals and clinics train
their healthcare workers and give them practice exercises to handle unexpected
increases in demand.
Quality Teams, Training, and Simulation
The popular use of quality teams is another preventive strategy. Get staff who are
directly involved in the service experience together, and ask them to identify prob-
lems they have seen or heard about and to suggest strategies for preventing those
problems. Adequate training of frontline employees before they even begin to serve
patients is also a preventive measure. Any highly reliable organization ensures that
its frontline staff know exactly what customers need, want, and expect from the
total experience and are motivated to do whatever it takes to meet (at a minimum)
and exceed those customer factors, every time.
Another preventive/proactive approach is to use analytical models, such as those
discussed in chapters 11 and 12, to simulate all or part of the delivery system or the
service recovery process. Once a model is created that represents a wide variety of
patientprovider interactions, the manager and staff can analyze each situation to
determine areas of service failures. On a simpler level, role playing and structured
scenario simulations can help employees evaluate all types of service problems and
learn effective recovery strategies.
Michel, Bowen, and Johnston (2008) suggest creating and communicating a
service logic that explains how everything ts together. This should be a kind of
370 Achieving Service Excellence
mission statement or a summary of how and why the business provides its services.
It should integrate the perspectives of all three groupscustomers, employees, and
managers:
What is the customer trying to accomplish and why?
How is the service produced and why?
What are employees doing to provide the service and why?
This statement should include a detailed study of internal operations, map out
how the organization responds to customer complaints, and describe how that in-
formation is used to improve the service recovery process. Similar mapping should
detail every step of customer experiences, highlighting customer thoughts, reac-
tions, and emotions.
Performance Standards
Performance standards are tools that not only help employees do their job during
the service experience but also guide employees and the organization in evaluating
the performance afterward. Employees and their managers can also use these stan-
dards to monitor how well or poorly they have performed over time.
Some standards are purely preventive because they can be met before patients
enter the door. For example, if a clinic can reliably predict the number of patients
who will come in on a given day of the week, that forecast can be used as a basis or
standard for the quantity of medical supplies to prepare and order. If the predic-
tion is correct, the service failure of not having enough supplies on hand should
not occur.
Other preventive performance standards should be set for the following:
Number of training hours required for staff annually
Number of equipment to be purchased
Number of examining tables to be set up
Level of supply inventory
Performance standards also help patients understand the level of service they
can expect. Examples of such standards include We will try to resolve problems of
types A, B, and C within two hours, We will try to resolve problems of types D,
E, and F within one week, or If you leave a message on our help-desk voicemail,
we will call you back within one hour.
Many customers of the Ritz-Carlton Hotel know, for example, that phone calls
are supposed to be answered within three rings and that after a customer registers
Chapter 14: Fixing Healthcare Service Failures 371
a complaint, a Ritz employee is supposed to make a follow-up call within 20 min-
utes. Similarly, hospital nurses in many facilities are aware that the patient call bell
is supposed to be answered within 30 seconds.
JetBlue provides an excellent example of service recovery reinforced by a service
guarantee. After snowstorms left some JetBlue customers stranded for many hours
on planes that were not equipped to provide food, water, and other creature com-
forts, JetBlue engaged its customers in a dialogue about what went wrong and how
the airline might x it. The CEO also instituted a service guarantee to indicate the
service standards it would implement in the future and the steps it was taking to
support that guarantee (Lane 2007). As a result, most JetBlue customers continue
to patronize the airline.
Poka-Yokes
To avoid wrong-side surgery, sometimes called bilateral confusion or symmetry
failure, the National Academy of Orthopedic Surgeons has urged its physician
members to sign their names on the spot to be cut. Surgical patients often write in
felt-tipped marker I hurt here with an arrow pointing to an elbow or yes on one
knee and no on the other. These doctors and patients, probably without knowing
the term, are using poka-yokes.
The poka-yoke is a proactive strategy that aims to keep service as awless as
possible. Conceived by the late Shigeo Shingo, an industrial engineer at Toyota
and a quality improvement leader in Japan, poka-yoke makes service quality easy
to deliver and service problems difcult to incur because it requires the inspection
of the system for possible problems and the development of simple means to pre-
vent or point out those mistakes. For example, a surgeons tray and a mechanics
wrench-set box often have a unique indentation for each item to ensure that no
instrument is left in a patient or no wrench is left in an engine. Another example
is the identication bands hospitals use to ensure that the right patient gets the
right treatment. Shingo called these problem-preventing devices or procedures
poka-yokes (POH-kah-YOH-kay), which means mistake proong or avoid
mistakes in Japanese.
Shingo distinguished three types of inspection:
1. Successive inspection, where the next person checks the quality and accuracy
of the previous persons work
2. Self-inspection, where people check their own work
3. Source inspection, where potential mistakes are located at their source and
xed before they can become service errors. Poka-yokes are used mainly to
prevent source mistakes.
372 Achieving Service Excellence
An example of successive inspection is when an orderly checks a patients chart
to ensure that it corresponds with the instruction about where the patient should
be transported. An example of self-inspection is when an attending nurse com-
pares the prepared drug against the patients chart before administering the drug.
An example of source inspection is when a surgical nurse examines the prepared
medical supplies (e.g., surgical tools, bandages) to ensure that sufcient kinds and
quantities of the items are available.
Poka-yokes are either warnings that signal the existence of a problem or con-
trols that stop production until the problem is resolved (Chase and Stuart 1994).
A warning poka-yoke could be a light that ashes when a patients blood pressure is
too low, signaling the nurse to adjust the drip before the patient goes into shock. A
control poka-yoke could be a device that turns an x-ray machine off whenever the
roentgen level is too high. Warning and control poka-yokes can be further divided
into three types: contact, xed values, and motion step.
Contact poka-yokes monitor an items physical characteristics to determine if it
is right or meets a predened specication. Some pharmacies, for example, prepare
standard quantities of drugs to ensure the dosage is correct before the medicine is
distributed. Fixed-values poka-yokes deal with established quantities. For example,
surgical teams use prepackaged surgical supplies so that they know exactly how
many bandages, surgical tools, and so forth are available for use. When the surgery
is completed, the team can count every item to make sure nothing has been left in
the patient. Motion-step poka-yokes are useful in processes where one error-prone
step must be completed correctly before the next step can take place. A simple ex-
ample is the start button on the x-ray machine. The button is outside the exposure
area so that technicians cannot take the x-ray until they leave the room and are
protected.
All poka-yokes should be simple, easy to use, and inexpensive. Something can
go wrong at any point in service delivery, and the poka-yoke method encourages
managers to think rst about what might go wrong.
Process Strategies
Process strategies for nding service failures monitor the delivery while it is taking
place. The idea is to design mechanisms into the delivery system that will catch and
x problems before they affect the quality of the healthcare experience; blood pressure
and heart monitors are examples of such mechanisms. The advantage of process con-
trols is that they can catch errors as they happen, enabling immediate correction.
Chapter 14: Fixing Healthcare Service Failures 373
Process performance standards provide employees with objective measures
with which to monitor their own performance while they are doing their job.
One example is specifying how long a patient has to wait in the emergency de-
partment before receiving attention. Other illustrations include the number of
times per hour that a nurse must check on an intensive care patient or the number
of patients waiting for service before a cross-trained staff member steps in to re-
duce the waiting time at peak demand. These are all process-related measures that
allow the staff to minimize errors or catch them while the healthcare experience
is underway.
An important part of any process strategy is to get unhappy patients to com-
plain during the healthcare experience. This is a more difcult challenge than one
might think: Although some patients are comfortable with complaining, most are
not. Most patients are either unwilling to take the time, believe no one cares or
will do anything about their complaints, or are too angry or too disappointed to
say anything.
Research on complaint behavior has identied strategies for encouraging pa-
tients to complain (Michel, Bowen, and Johnston 2008):
Solicit complaints. Because many service failures are caused by provider
errors, all personnel should be trained to solicit complaints about their own
performance. This is not an easy task for providers, as they may see mistakes
are punished while catching errors is rewarded, and most people do not want
to admit their mistakes or feel criticized for them. Thus, the organization
must design a complaint strategy that accommodates its staff s perception
about complaints.
Read a patients body language for clues on her dissatisfaction. This observation
can yield information that might otherwise go unmentioned. Frontline staff or
direct caregivers should be trained to watch and recognize body language and
to be receptive and sympathetic once the complaints are verbalized. Patients
must perceive these employees as being interested and concerned about their
well-being and opinions. Otherwise, patients will feel wary and will choose
not to say anything.
Empower staff. Provide employees with the freedom to address complaints and
service failures on their own, as much as the organizations business strategy
allows. Autonomy encourages staff to do what is right for the customer, and
that prevents service failures from happening in the rst place. For example,
Ritz-Carlton authorizes front-desk personnel to credit unhappy customers up
to $2,000 without asking approval from a supervisor.
374 Achieving Service Excellence
Outcome Strategies
Outcome strategies identify service problems after they have occurred so that prob-
lems can be xed and future problems can be prevented. The most basic outcome
strategy is simply to ask the patient, How is everything going today? Other more
systematic illustrations include (1) providing toll-free or 800 phone numbers for
use by former patients who want to report their dissatisfaction and (2) asking pa-
tients to ll out a brief questionnaire when they pay their bills.
Organizations must make unequivocally clear to patients that they care to know
about any service failures that patients have encountered. What inuences a pa-
tients decision to seek redress for a problem or to let it go is her perception of
whether the organization will do something about it. Even patients who are re-
luctant to complain are more likely to do so if they think something will be done
about the problem (Davidson 2007). Customers often do not want a payoff; they
simply want a resolution, an apology, and the reassurance that the problem will not
happen again to them or to others.
The more the organization depends on repeat business and recommendations
from past patients through word-of-mouth reputation, the more critical it is that
the complaints of its customers are acknowledged and acted on. Some health-
care organizations report their complaint investigations back to those patients who
made the complaint in detail, including information on what people were affected
and what systems were changed. In that way, the organization shows it is respon-
sive to the patients complaint and gives the complainant a sense of participation in
the organization, which may positively enhance loyalty and increase repeat visits.
If the complaint identies a aw the organization can correct, and if knowledge
of the correction provides the patient with a sense of satisfaction for reporting a
complaint that was important and acted on, a true winwin situation results.
Some numerical measures that organizations collect as a matter of normal pro-
cedure can point to real and potential service problems. Total stafng or nurse
stafng per patient day is an example. Although it is used primarily to keep track of
costs, stafng varies by department, oor, or shift. If one shift is signicantly below
the norm, this may indicate possible service problems.
Healthcare organizations should also collect meaningful measures of employee
performance as it relates to service recovery. Positive reinforcement and incentives
should be offered for solving problems, but this requires a good system for measur-
ing customer satisfaction. Salary increases and promotions could then be linked to
an employees achievements in these areas. Likewise, there should be disincentives
for poor handling of customer complaints.
Chapter 14: Fixing Healthcare Service Failures 375
On the positive side, organizations should spotlight employee successes in cus-
tomer service using available media such as in-house publications, the intranet, and
bulletin boards. Such success stories may also be shared during customer service
or culture trainings. Rewards and recognition should ow to heroes in service re-
covery, including those who helped to develop systems for handling complaints or
provided extraordinarily helpful treatment after a service failure (Michel, Bowen,
and Johnston 2008).
Consumers in the healthcare industry are reluctant to complain because they
fear they may receive lower service quality if and when the need for future care
arises (Fottler et al. 2006). Fewer than half of the patients who have a negative
experience with a hospital actively try to change the unsatisfactory situation. This
suggests that written complaints only reect a small portion of total complaints
(Berry and Seltman 2008).
Employee-Driven Strategies
Employees, especially direct or frontline providers, should be trained to handle
service failures and to creatively solve problems as they occur. Scenarios, game play-
ing, videotaping, and role playing are good strategies for developing employees
service recovery skills. Just as umpires can be trained to recognize balls and strikes,
healthcare personnel can be trained to recognize and x service errors.
Do Something Quickly
The basic service recovery principle is to do something positive and to do it quickly.
Strive for on-the-spot service recovery. Capturing the many benets of quick recov-
ery is one major reason benchmark service organizations empower their frontline
employees to exercise discretion in correcting errors. Employees of one service or-
ganization carry a card on which the following three principles of service recovery
are written:
1. Any employee who receives a customer complaint owns the complaint.
2. React quickly to correct the problem immediately. Follow up with a telephone
call within 20 minutes to verify that the problem has been resolved to the
customers satisfaction. Do everything you possibly can to never lose a
customer.
3. Every employee is empowered to resolve the problem and to prevent a repeat
occurrence.
376 Achieving Service Excellence
Many times, customers will log complaints with the nearest employee they can
nd, so organizations benet from asking employees to attempt to capture the
complaint as soon as possible. The physician or staff member who initially receives
a complaint should complete a patient complaint form, and staff members who
receive the complaint should immediately refer the patient to management per-
sonnel. Even if a manager is not immediately available, the staff member should
complete the form and begin to take action because complaints must be captured
as soon as possible.
Other suggestions for service recovery include the following (Grugal 2002):
Ask patients the critical question, What can I do to make this right?
Evaluate the complaint to identify signifcant dissatisfers.
Write down the specifcs.
Communicate and interact in a pleasant manner.
Management must empower employees with the necessary authority, responsi-
bility, and incentives to act quickly after a problem occurs. The higher the cost of
the problem to the patient in terms of money, personal reputation, or safety, the
more vital it is for the organization to train the healthcare staff to recognize and
deal with the service problem promptly, sympathetically, and effectively. Of course,
empowering staff to resolve problems will not be sufcient if recovery mechanisms
are not in place. If the rest of the system is in chaos, empowering the front line will
not do much good.
A quick reaction to service problems has numerous benets:
1. It reduces the overall expense of correcting a wrong.
2. It keeps and creates goodwill between the organization and patients and
their family.
3. It generates positive word of mouth that could lead to repeat business or
referral and recommendation.
4. It strengthens the message that customers are valued.
5. It encourages employees to commit to providing high-quality service
consistently.
Address Root Problems
A necessary further step in any service recovery strategy is that employees should
inform their managers about any system failures they encounter, even if they have
already initiated successful recovery procedures. If they do not report the failure,
the problem may recur elsewhere in the organization.
Chapter 14: Fixing Healthcare Service Failures 377
Collecting these data enables management to move beyond reacting to com-
plaints and on to determining the root causes and preventing them from happen-
ing. Cause-and-effect diagrams might focus staff s attention on those areas that
need the greatest improvements.
The reactions of frontline workers to service failures caused by the system have
signicant implications for customer satisfaction. The common reaction is simply
to remove the obstacle or solve the problem and to continue patient care. But an
empowered staff should also be offered incentives for removing the root cause of
the problem to prevent future recurrences.
For example, a nurse may nd that her newest patient was not served lunch.
Assuming that it was an oversight, she might call food service and order the lunch
for the patient. This might solve the immediate problem, but if the underlying
cause was that admissions failed to advise food service of the new patients ar-
rival, the same problem will occur in the future because the root cause was not
addressed.
The best service organizations encourage staff members to address both the
immediate service failure (the symptom) and the root cause. This is facilitated by
including problem resolution as an explicit part of the staff s jobs, allowing enough
time to address the problem, encouraging communication between staff, dedicat-
ing proper attention to problems, and giving incentives/rewards to those who en-
gage in this type of extra work.
Apologize and Let the Customer Vent
All healthcare personnel should be trained to apologize, ask the patients about the
problem, and listen in a way that gives patients the opportunity to blow off steam.
Considerable research indicates that allowing customers the opportunity to vent to
someone with authority (e.g., manager, supervisor, vice president) is an important
step in retaining their patronage (Heskett, Sasser, and Hart 1990).
This strategy is more effective when it is followed up with an acknowledgment,
a thank you, and a tangible reward, even if it is small (Berry 2009). The tangible
reward could take the form of a meal voucher at the hospital cafeteria, and the
acknowledgment could take the form of an apology and thank you letter from the
CEO.
Patients Evaluation of the Recovery Efforts
Patients who have suffered a service failure and lodged a complaint want action.
Procedural fairness refers to whether or not the patient believes organizational
378 Achieving Service Excellence
procedures for listening to the patients side and handling service problems
are fair or merely a procedural hassle full of red tape. Customers also want an
easy process for correcting problems. They think that if the organization failed
them, it is only fair that the organization makes it easy for them to receive a
just settlement.
Interactive fairness refers to the customers feeling of being treated with re-
spect and courtesy and being given the opportunity to express the complaint
fully. If she has a complaint that the service provider is rude, indifferent, or
uncaring, and the manager cannot be found, the customer will feel unfairly
treated. Common sense suggests that a customer who is encouraged to com-
plain, treated with respect and courtesy, and given a fair settlement is more
likely to return than a customer who is given a fair settlement that is offered
with reluctance and discourtesy.
Distributive fairness, or outcome fairness, is the third test patients apply to an
organizations attempts to recover from problems. What did the organization actu-
ally give to the unhappy patient as compensation for the problem? If the patient
complains about a rude housekeeper and gets only a sincere apology because that
is all hospital policy calls for, the patient will feel unfairly treated; somehow were
sorry may not be enough in the patients judgment to compensate for the rude
treatment.
Once again, it all comes down to meeting the patients expectations. The
issue is difcult because each patient is different. Finding the satisfactory com-
pensation may involve methodical trial and error on the organizations part.
Some research indicates that customers feel more fairly treated when organiza-
tions offer a variety of options as compensation for service problems (Berry
2009; Tax and Brown 1998). For example, a physician can offer a patient the
choice of an immediate appointment (if desired) or can offer to ll the patients
prescription for free.
In sum, investing time, money, staff, and effort into service recovery is just plain
good business.
CHARACTERI STI CS OF A GOOD
RECOVERY STRATEGY
In their classic study, Hart, Heskett, and Sasser (1990) believe service recovery
strategies should satisfy several criteria. More specically, service recovery strategies
should be as follows:
Chapter 14: Fixing Healthcare Service Failures 379
Ensure that the problem is addressed in some positive way. Even if the
situation is a total disaster, the recovery strategy should ensure that the
patients problem is addressed and, to the extent possible, xed.
Be communicated clearly to the employees charged with responding to
patient dissatisfaction. Employees must know that the organization expects
them to nd and resolve patient problems as part of their jobs.
Be easy for the patient to fnd and use. They should be fexible enough to
accommodate the different types of problems and the different expectations
that patients have.
Always recognize that because the patient defnes the quality of the service
experience, the patient also denes its problems and the adequacy of the
recovery strategies.
A strategy that does not make some improvement in the situation for the com-
plaining patient is worse than useless because the organization makes it plain that
it cannot or will not recover from a problem even when informed of it. The work
of Hart, Heskett, and Sasser (1990) suggests that most recovery strategies are in
serious need of improvement. More than half of organizational efforts they identi-
ed that respond to consumer complaints actually reinforce negative reactions to
the service. In trying to make things better, organizations too often make them
worse.
One reason that patients view many recovery strategies as inadequate is that the
strategies do not really take into account all of the costs to the patient. Did the doc-
tor miss an appointment? Schedule another one. Is there a busy signal on the tele-
phone line for hospital information? Interject a recorded apology. The organization
may think the relationship is back where it started, but for the patient many costs
are associated with service problems, and effective organizations will try to identify
them and include some recognition of them in selecting the appropriate service
recovery. After all, the fact that the test results were not delivered by the promised
date is not the patients fault, so why should the patient have to suffer additional
mental stress waiting for results? Why should the patient lose more work time as a
result of a provider-cancelled appointment?
Patients clearly think that when a healthcare problem occurs, organizations
need to do more than simply make it right by replacing it or doing it over again.
The high numbers of malpractice suits substantiate that point. For example, if the
excessively long wait beyond the appointed time causes the patient to miss half a
days salary, then the recovery strategy should include not only an apology but also
some compensation for the patients loss of income as well. Outstanding healthcare
380 Achieving Service Excellence
organizations systematically consider how to compensate patients for economic
and noneconomic losses and take extra effort to ensure that dissatised patients
have not only their time and nancial losses addressed in a recovery effort but also
their ego and esteem needs.
Even when the patients themselves make mistakes, good healthcare organiza-
tions help to correct them with sensitivity. They make sure patients leave feeling
good about their overall experience and appreciating how the organizations staff
helped them redeem themselves. Imagine how depressed you would feel if you
came back to the hospital parking lot after a long day of visiting a terminally ill
family member only to nd that you have lost your car keys and are locked out of
your car. You tell the parking attendant, and half an hour later a locksmith hands
you a new set of keys, no charge!
Even though car key problems are not its fault, a customer-oriented organiza-
tion believes the customer needs to be wrong with dignity. It knows that customers
who are angry at themselves may transfer some of that anger to the organization.
To overcome this very human tendency, customer-focused organizations nd ways
to x problems so that angry, frustrated people leave feeling good because a bad
experience has not been allowed to overshadow or cancel out all the good. By
providing this high level of customer service, the healthcare organization earns the
gratitude and future patronage of patients and enhances its reputation when pa-
tients and their families tell external and internal customers stories of these service
successes.
Matching the Recovery Strategy to the Problem
The best recovery efforts are those that address the customers problem. For ex-
ample, suppose a patient tried to contact her physician by phone (as instructed) on
a certain day and time, was put on hold, and ended up leaving a message asking the
physician to return her call. If the return call was never made, a communications
problem undoubtedly occurred, but the result for the patient is that the physician
appears to be uncaring. An appropriate recovery effort might be to provide the
patient with the physicians personal cell phone number.
Categorizing the severity and causes of service problems might be a useful way
to show the type of recovery strategy a healthcare organization should select. In
Exhibit 14.1, the vertical axis represents the severity of the problem, ranging from
low to high, and the horizontal axis divides service problems into those caused by
the organization and those caused by the patient. When severity is high and it is
Chapter 14: Fixing Healthcare Service Failures 381
Exhibit 14.1 Matching the Recovery Strategy to the Failure
the organizations fault (e.g., when a service failure occurs that totally alienates the
patient), the proper response is the red-carpet treatment. The organization needs
to bend over backward to apologize, communicate empathy and caring, and ad-
dress the patients problem, because it will take an outstanding recovery effort to
overcome the patients negative feeling.
The two types of situations in Exhibit 14.1 where the patient caused the
problem provide terric opportunities for the organization to make patients feel
positive about the experience, even though the patients caused the problem. In
a low-severity situation, a sincere apology is sufcient and will make the patient
think the organization is taking some of the responsibility for a situation that was
clearly not its fault. Indeed, some organizations will do even more, if the cost to
make a patient feel better is not substantial. Hospitals will often change meals if
patients say they do not want them, even when the records show the meals were
just what the patients ordered. The wrong meal may not be the hospitals fault,
but the patient feels good that the organization will not make patients pay for
their own mistakes.
The upper-right box represents situations where the problem is relatively severe
and the patient or some external force created the problem. These are opportuni-
ties for the organization to be a hero and provide an unforgettable experience for
the patient. For example, if the patient is late for an appointment because she got
delayed in trafc and arrived when the physician is busy with the next patient,
the receiving nurse can come out and promise that the physician will see the late
patient next.
a patient feel better is not substantial. Hospitals will often change meals
if patients say they do not want them, even when the records show that
the meals were just what the patients ordered. The wrong meal may
not be the hospital's fault, but the patient feels good that the organi-
zation will not make patients pay for their own mistakes.
The upper-right box represents situations where the problem is rel-
atively severe and the patient or some external force created the prob-
lem. These are opportunities for the organization to be a hero and provide
an unforgettable experience for the patient. For example, if the patient
is late for an appointment because she got delayed in traffic and arrived
when the physician is busy with the next patient, the receiving nurse can
come out and promise that the physician will see the late patient next.
CONCLUSION
According to the t arp study, companies that invested in the forma-
tion and operation of units designed to handle complaints realized
returns on the investment of anywhere from ,c percent to i,c per-
cent.
c
These results, and the other research reported in this chapter,
suggest strongly that putting money and effort into service recovery is
good business.
Service recovery rules can and should be developed for staff. For
example, if a customer is unhappy because of an unmet need and the
staff member can meet that need for less than, say, sicc, then the staff
f i xi ng heal t hcar e s ervi ce pr obl ems ,oi
Figure 13.1 Matching the Recovery Strategy to the Failure
Severity of
Failure
Relatively
Severe
Red-carpet
treatment
and apology
Apologize and
fix/replace/
repeat
Provide help
to the extent
possible and
apologize
Relatively
Mild
Apologize
and extend
sympathy
Organization Patient
Cause of Failure
Fotter/book 8/12/02 3:47 PM Page 361
382 Achieving Service Excellence
CONCLUSI ON
Service recovery rules can and should be developed for staff. For example, an
employee should be given permission to spend a specic sum to correct a ser-
vice problem. If the cost is beyond the limit an employee is allowed to spend,
the staff member should contact her supervisor to discuss other alternatives or
to seek approval for the expense. In this way, staff are empowered to x the
problem on their own without any bureaucratic delay that could cause an un-
happy customer to defect.
In addition, staff should be trained on what to do and say to a patient in the
event of a service failure. Employees must be told that they will not be criticized for
overserving customers, that risk taking and innovative approaches to please cus-
tomers are encouraged, and that service failures and recovery are monitored. The
latter requires installing a system for collecting detailed information on customer
dissatisfaction and defection. Gathering such information should involve frontline
staff, as they are intimately familiar with the service problems that take place and
thus can help the organization determine the root causes and prevent them from
happening.
Learning from failures is more important than xing problems. It is crucial to
address the system and process problems that cause the failure in the rst place.
Service Strategies
1. Realize that service-failure prevention is superior to and less costly than
service-failure recovery.
2. Encourage patients to complain; a complaint is a gift.
3. Train and empower your staff to nd and x problems.
4. Train your staff to listen to dissatised customers with empathy, and then
record the service problem and its resolution.
5. Find a solution the customer believes to be fair, and help patients x service
failures they caused.
6. Remember that unhappy patients tell twice as many people about their
dissatisfaction than happy patients tell others about their excellent
experience.
7. Find out and share with employees how much a dissatised patient costs
the organization to illustrate the importance of service recovery.
8. Address the root causes of service failure.
383
A good leader is best when the people barely know he leads. A good leader
talks little but when the work is done, the aim is fullled,
all others will say, We did this ourselves.
Lao-tzu, Chinese philosopher
C H A P T E R 1 5
Leading the Way to Healthcare
Service Excellence
Service Principle:
Lead others to provide a superb healthcare experience
Providing an excellent healthcare experience is simple. Study your patients
and other customers to nd out what they really need, want, and expect, and then
provide those and maybe even a little bit more. Healthcare managers committed to
providing a superb total healthcare experience do not stop studying their custom-
ers, using all available scientic tools.
Because no two customers are alike and their personal preferences and condi-
tions change, this process of discovery is never complete.
The service product, the service environment, and the service delivery system
must change or evolve along with and to complement the customers. The informa-
tion from this continuous study is used to shape the decisions on strategy, stafng,
and systems.
This chapter brings together the books important concepts to help the health-
care manager achieve service excellence. In this chapter, we address the following:
A model of service excellence in healthcare
Our view of healthcare in the future and the leaders role
Again, we emphasize that service excellence is insufcient by itself in meeting
patient needs, wants, and expectations. Excellent clinical service that successfully
addresses the patients health concerns is the prerequisite to service excellence.
384 Achieving Service Excellence
A SERVI CE EXCELLENCE MODEL
Exhibit 15.1 presents a conceptual framework for achieving service excellence that
shows the impact of service excellence on a healthcare organization. The box on
the left outlines some of the major environmental trends currently affecting or
expected to affect organizations. Some of these may impede and others may po-
tentially help the efforts of organizations to enhance customer service. Among the
most signicant of these environmental trends are consumer-driven healthcare, a
shortage of primary care providers, and potential health insurance reform.
The external environmental and other factors noted in Exhibit 15.1 affect the
structures, processes, and outcomes of healthcare organizations. Among these ef-
fects are increased incentives for organizations to develop more customer-focused
strategies, stafng, and systems. If successful, such strategies, stafng, and systems
should enhance patient satisfaction in the short run (Platonova, Kennedy, and
Shewchuk 2008). If sustained over the long run, this customer-focused approach
will improve customer loyalty to the organization (Garman, Garcia, and Harg-
reaves 2004; Platonova, Kennedy, and Shewchuk 2008). Similarly, it will increase
the probability that the patient will return for service and recommend the organi-
zation to others (Platonova, Kennedy, and Shewchuk 2008).
More organizations are realizing that patient loyalty and retention are para-
mount issues (Bendapudi et al. 2006). The feedback loop (as shown in Exhibit
15.1) indicates that a customers intention to return to and recommend an organi-
zation are associated with increased revenue and reduced resource demands, which
positively affect the organizations structure, process, and outcomes (Evanschitzky
and Wunderlich 2006; Platonova, Kennedy, and Shewchuk 2008). The process is
continuous because more resources enable the organization to enhance its service
product, environment, and delivery system.
External Environmental Changes
Healthcare Reform and Consumer-Driven Healthcare
The Obama administration puts a high priority on health insurance reform, high-
lighting that an estimated 45 million Americans are uninsured. Hospitals, insur-
ers, government ofcials, managed care providers, corporations, and academicians
have also proposed a wide variety of reforms, most of which do not give a high
priority to consumer choice.
One exception is Regina Herzlinger (2007b), who advocates for a consumer-
driven healthcare system in her book Who Killed Healthcare? Herzlinger proposes
the following:
C
h
a
p
t
e
r

1
5
:

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a
d
i
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h
e

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i
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3
8
5
Exhibit 15.1 Service Excellence Process and Associated Outcomes
Changing Environment
Healthcare reform
and consumer-driven
healthcare
Increasing
documentation of
clinical and service
outcome
Shortage of primary
care providers
Potential
reimbursement
reform
Healthcare Organizations
Structure, Processes, and
Outcomes
Clinical outcomes
Service outcomes
Customer Service Stafng
Enhanced
recruitment and
retention
Enhanced training
for customer service
Enhanced employee
rewards and
recognition
Discretionary
coproduction
Customer Service Systems
Enhanced
communication and
information
Redesigned service
delivery system
Reduced waiting
Enhanced service
recovery
Customer Service Strategies
Enhanced planning
Upgraded
environment
Enhanced service
culture
Patient Decisions
and Organizational
Outcomes
Patient decision to
return
Patient decision
to recommend to
others
Enhanced fnancial
returns
Patient
satisfaction
Patient
loyalty
386 Achieving Service Excellence
Consumers tailor their own healthcare coverage in a national insurance
market.
Everyone must buy insurance, and the federal government maintains strict
oversight to ensure price and coverage fairness.
Small, disease-specifc hospitals care for patients who do not need all the
services offered by medical centers.
A national database contains the prices and outcomes for procedures at every
hospital and clinic so that consumers can make informed choices.
Individuals get generous tax breaks to buy their own insurance, and subsidies
are provided for those with low incomes.
In other words, Herzlinger asks, Why cant healthcare be run like the retail sec-
tor? (Arnst 2008). If hospitals, insurers, and doctors all had to compete in the
open market for patient customers, she believes innovation would ourish, prices
would drop, and quality would improve.
Herzlinger does not want anyone but consumers managing health benets.
Given that the average consumer is able to choose between 240 makes and models
of cars, why cant they do the same when it comes to their health? In other words,
regardless of who pays for the health benets, Herzlinger would like consumers to
have a wide range of options regarding the selection of providers. That decision
would be buttressed by widespread information on prices, clinical quality, and
service quality.
For those who believe government agents, employers, and private insurance
companies are best suited to make healthcare decisions, consumer-driven health-
care is anathema. They are united by two common beliefs (Kapp 2007):
1. Patients are not able to act as intelligent consumers when it comes to
healthcare.
2. Consumer-driven healthcare will result in loss of their money, power, or
control.
These people prefer a top-down command-and-control approach to healthcare
reform that will not emphasize customer choice and service as primary goals. They
would limit consumer choices to the best options as dened by experts in the
eld. Such a limitation will likely reduce consumers perception of the overall qual-
ity of the services received.
For those who respect consumers ability to make choices, however, healthcare
reform represents a tremendous opportunity; that is, if the reform that passes ends
Chapter 15: Leading the Way to Healthcare Service Excellence 387
up to be centered on choice and service excellence. In addition, it should reward
providers who achieve excellent clinical and customer service outcomes. However,
if the special interests in the healthcare industry (e.g., insurers, pharmaceutical
companies) sabotage a consumer-oriented reform and enhance the command-and-
control approach, the average American may experience a less responsive and more
bureaucratic healthcare system in the future (Kapp 2007).
In 2007, the federal government began posting patient satisfaction scores for
hospitals (see HCAHPS [Hospital Consumer Assessment of Healthcare Providers
and Systems] on www.hcahpsonline.org). The HCAHPS and state governments
posting of hospital prices and quality measures (including patient satisfaction) give
consumers greater transparency in healthcare practices and outcomes, regardless of
the outcome of the proposed healthcare reform. Consumers have been increasingly
considering customer service, price, ease of access, clinical quality, and ethics of the
provider in assessing their healthcare options, regardless of whether or not health-
care reform is characterized as consumer driven (Bodnar 2007).
In other words, clearly, the healthcare reform debate has touched on many is-
sues paramount to consumers, including who will pay for services, how providers
and insurers will be held accountable, and how quality and choices will be man-
aged. Final answers to these questions have not yet been determined; however, the
2009 reform will have a major impact on the quality of customer service experi-
enced in the future.
Increased Documentation of Clinical and Service Outcomes
As customer service information becomes readily available to providers, employers,
insurers, and consumers, performance-based reimbursements will likely increase
along with the importance of customer service. In addition, stakeholders will con-
sider ease of access, clinical quality, and effectiveness of treatment in evaluating
the value of a provider. As calls for public accountability and data transparency
intensify, the concepts and principles discussed in this book can help organizations
make adjustments to improve their overall service and quality performance. Ignor-
ing service excellence will be costly to an organizations bottom line.
The retail clinic trend may also enhance the documentation of clinical and ser-
vice outcomes (Fottler and Malvey 2010). Advances in technology will boost the
transparency, low cost, and easy access to services offered by retail clinics, allowing
these clinics to make public the service and clinical outcomes they have achieved.
Eventually, such clinics may begin to offer specialty services as well. Wal-Mart and
other major retailers would not be entering this eld if consumers were satised with
the access, quality, and prices available to them in the current healthcare system.
388 Achieving Service Excellence
Shortage of Primary Care Providers
In 2008, the Physician Foundation commissioned a survey of every primary care
doctor in the United States, and the results suggest that primary care doctors are an
endangered breed (Rubin 2008). More than three of four respondents said they be-
lieved the United States is facing a shortage of primary care physicians. Moreover,
this perception of a shortage could grow more critical, as half of the respondents
said they planned to reduce their patient load or stop practicing within the next
three years. More than half of the respondents said they would not recommend
that young people pursue careers in medicine because of red tape and payment
issues. These results indicate that the healthcare system tends to undervalue what
primary care doctors do.
To keep up with service demands over the next decade, the United States must
add 40,000 physicians to its current pool of practicing providers, or else the coun-
try will face a soaring backlog (Associated Press 2009). The current shortage in all
physician specialties is expected to worsen. A study by the Association of American
Medical Colleges found that the rate of rst-year enrollees in U.S. medical schools
has declined steadily since 1980, and if this pattern continues, the country will
have about 159,000 fewer doctors than it needs by 2025 (Associated Press 2009).
The survey results are relevant to the concept of service excellence in healthcare
because primary care physicians are often the rst provider a patient sees. Research
shows that a sustained relationship with a primary care physician, as well as the
resulting comprehensiveness of care, organizational accessibility, and coordination
of care, is associated with higher levels of patient satisfaction (Donahue, Ashkin,
and Pathman 2005; Saultz and Albedaiwi 2004) and better treatment outcomes
(Parchman and Burge 2004). If primary care physicians are overworked and un-
derstaffed, patients will have long waits for appointments, and time spent with the
physician will be minimal. The shortage of primary care providers is exacerbated
by the fact that a shortage of nurses and allied health professionals, such as physical
therapists, is ongoing.
This shortage of primary care physicians is a problem that must be addressed
because it is difcult to imagine high levels of service excellence without them. Fed-
eral subsidies for the education of primary care physicians as well as other health
professionals appears to be a necessary prerequisite for achieving long-term service
excellence.
Potential Reimbursement Reform
Under the current reimbursement system, physicians are reimbursed for proce-
dures but not for such activities as e-mail and phone communication, listening
to patients, coordinating care for patients, and so on (Szabo 2007). All of these
Chapter 15: Leading the Way to Healthcare Service Excellence 389
activities are related to customer satisfaction, so changes in reimbursement that
recognize the importance of these activities for enhancing the healthcare experi-
ence of patients is overdue. Whether it will occur under a command-and-control
healthcare reform or a consumer-driven reform remains to be seen.
For example, physicians agree that patients with chronic conditions, such as
cancer, deserve coordinated care provided by a team of healthcare professionals.
However, most doctors do not have time for group consultations, are not used to
working in teams, and are not reimbursed for many of the services teams provide
(e.g., spiritual counseling, social work) (Szabo 2007). Providing such services re-
duces future costs for the healthcare system, but the physicians themselves receive
no nancial benets because they are not reimbursed for these activities. Providing
coordinated care through a team of healthcare professionals would require chang-
ing the way Medicare, Medicaid, and private third-party insurance pay for care.
Changes in reimbursement to pay for the softer side of healthcare can sig-
nicantly increase customer service, healthcare outcomes, and patient satisfaction.
Whether such changes are incorporated in the nal healthcare reform plan remains
to be seen and may be difcult to implement in light of the current economic
downturn. Thus far, health insurance reform has aimed to cover more people and
to expand reimbursement for current procedures. Discussions about reimbursement
for better communication, better clinical outcomes, and better customer service have
not been as intense.
STRATEGY
Today, an amazing amount of information is available about patients and what the
competition offers in providing services to those patients, and only the organiza-
tions that tap into that information to truly understand what their patients and
other customers want will survive and prosper. They must use this information to
design a corporate strategy, discover which of their competencies customers con-
sider to be core, and then concentrate on making these core competencies better.
For example, they use the customers wants, needs, and expectations to sharpen
their marketing strategies, budgeting decisions, organizational and production sys-
tems design, and human resources management strategy.
Southwest Airlines is an excellent example of a company that has used its un-
derstanding of the customer to discover and then provide what its passengers re-
ally want. Like most organizations, Southwest originally used customer surveys
to ask what customers wanted and found customers wanted everything: cheap
fares, on-time performance, great meals, comfortable seats, free movies, and more.
390 Achieving Service Excellence
Southwest realized it could not give its customers everything, so it did additional
research to dig deeper into customer preferences and learned that its customers
really wanted low fares, reliable schedules, and friendly service. The Southwest
product is now exactly what its target market wants and, more importantly, wants
enough to pay for and return to again and again.
The point of this example for healthcare managers is that they must dig deeper
than the simple market survey of patient preferences to understand what prefer-
ences actually drive patient behavior. The organization can use the results from
deeper probing to match the organizations core competencies and mission with
what the customers want.
Key Drivers
Outstanding organizations study their patients extensively to discover the key driv-
ers of their healthcare experience. Some drivers are highly inuential, and some
seem relatively unimportant. Nonetheless, they all contribute to the impression
the patient takes away from the healthcare experience and help determine whether
or not that patient will be satised. A trip to a hospital, or a visit to a physicians
ofce or clinic, is a holistic experience to most people; excellent customer service
organizations do the research necessary to identify all the separate components of
this whole experience. Then they carefully manage them all.
In a sense, key drivers can be divided into two categories. The rst category
consists of basic things patients expect the organization to offer its patients to oper-
ate in the particular market segment. For example, customers expect the following
basics from a hospital: nice, clean rooms; acceptable food; appropriately trained
and skilled medical and professional staff with a decent bedside manner; a caring
attitude; efcient work systems; a clinical product of high quality; and no irrita-
tions in the environment.
The organization must meet these basic expectations, or customers will be dis-
satised. If the organization habitually fails to meet these basic expectations, it
will fail altogether. Organizations must offer the basic characteristics if they seek
to maintain a reputation and attract the repeat business that leads to long-term
success.
The second category of key drivers encompasses the characteristics and qualities
that make the experience memorable. These are the features that differentiate the
experiences at an excellent organization. Benchmark organizations nd a way to go
beyond meeting the basic expectations with which patients arrive when they come
in the door to have a medical need addressed. Outstanding organizations provide
Chapter 15: Leading the Way to Healthcare Service Excellence 391
the key factors that make a difference, make the experience memorable, compel pa-
tients to return again and again, and even motivate patients to tell all their friends
about these exceptional organizations.
The following organizations survey customers to determine how well they are
providing the basics that patients need, want, and expect: Holy Cross Hospital
in Chicago; Sharp HealthCare in San Diego, California; SSM Health Care in St.
Louis, Missouri; Baptist Health Care in Pensacola, Florida; St. Marys Hospital in
Green Bay, Wisconsin; Parkland Health & Hospital System in Dallas, Texas; and
Albert Einstein Healthcare Network in New York. These organizations also use a
variety of techniques to identify the key drivers that determine how customers view
the total healthcare experience.
The key drivers of patients and other customers will vary from one facility to
another. For example, a managed care company may nd that its customers want
easy access online, responsive and knowledgeable customer service representatives,
and an unchanging panel of providers. For a primary care physician practice, the
key drivers might be the possibility of quick appointment scheduling, physician
promptness in seeing the patient at the appointed time, and clear communication
from the physician and nurse.
Generally speaking, the key drivers reect expectations related to clinical out-
comes, behaviors (i.e., being treated with respect and dignity), systems and pro-
cesses (i.e., the way patients are scheduled for tests), and the environment (i.e.,
cleanliness and ease of navigation). Each organization needs to identify its custom-
ers key drivers in general and then do the same for customers in each department
and/or service/product line. Customers for certain services or products may have
different expectations from customers for other services or products. An emer-
gency department (ED) patient, for example, has expectations different from those
of a maternity-ward patient.
An organization cannot know what factors in the service product, the environ-
ment, and the delivery system are key to patient satisfaction and intent to return
until it carefully studies all of these drivers. Many times, what management learns
in such studies is a surprise because what management thought were key drivers
may not turn out to be so from the patients point of view. This service gap is
the difference between what the organization delivers and what the patient needs,
wants, and expects. No matter how much patient data it collects and analyzes, the
organization may still be surprised occasionally by what patients say are important
to them.
Excellent organizations not only study their patients extensively but also accu-
mulate the information they have learned about patients, individually and collec-
tively. Computerized databases and sophisticated techniques of database analysis
392 Achieving Service Excellence
allow an organization to know a great deal about its patientsas a demographic,
as a psychographic group, or as individuals. The best organizations mine these da-
tabases to dig up as much information as they can about what is important to their
patients so they can ensure that they provide what is expected.
Extras
Outstanding organizations that attract repeat patients accumulate patient informa-
tion that may be used to customize the service experience. In other words, these or-
ganizations know that the best get even better by wisely using customer databases
to personalize each patients healthcare experience according to her unique needs,
wants, and expectations.
Some hospitals have developed systems for making each patient feel special by
letting each manager view the service experience for a particular diagnosis from the
patients perspective. For example, a manager might follow a patient undergoing an
MRI (magnetic resonance imaging) procedure so that he too can experience every
step of the process. Within 24 hours, the manager calls staff to a debrieng session,
during which participants discuss the experience and any problems encountered
and then brainstorm solutions. Later, the manager documents the experience and
the items discussed at the session, including key observations, improvement op-
portunities, and recommendations. In this way, not only does the organization get
a chance to improve its service product and strengthen its managers commitment
to customer service, but the patient being observed and monitored also gets to feel
special.
Knowing what makes each patient feel special enables organizations to add the
differentiating factors and extras all excellent organizations want to provide to keep
their patients so satised they will want to return if and when they need treatment
again. The little bit more than the patient expected can make the difference; it can
turn a satisfactory experience into a memorable one and can keep the organization
at the top of the customers mind when thinking about where to go the next time a
particular patient service is desired or when making recommendations to others.
These extras can be built into the service product, the environment, the service
delivery system, or across all parts of the service experience. Based on knowledge
about patient key drivers and likes and dislikes, the designers of the experience can
build in those things that will make a noticeable positive difference in the patients
mind. They should, however, always follow up to develop the metrics that will
allow them to know if they were successful and, if not, they should initiate efforts
to nd out where and why they failed.
Chapter 15: Leading the Way to Healthcare Service Excellence 393
The extras do not have to be expensive, complicated, or elaborate, although
they may be. Bedside manner does not cost anything, for example, but certain en-
vironmental features may be quite expensive. Florida Hospital in Orlando has cre-
ated a staff positionconciergefor its orthopedics unit. This position involves
being a contact person for each patient and making sure that each patient receives
a seamless healthcare experience.
Planning
Providing the patient with both the expected parts of the healthcare experience and
the extra or differentiating factors is the result of extensive planning. And this plan-
ning always starts with the patient. Capacity and location decisions, stafng plans,
the design of personnel policies, and the selection of medical equipment must all
be based on the organizations best information on what kind of experience the
patient wants, needs, and expects from the organization.
If the organizations mission is to build a chain of freestanding doc-in-the-
boxes, then it must identify what stafng, locations, medical equipment, exte-
rior appearances, and clinic sizes it should have. These decisions can be properly
made if they are based on solid and extensive customer research. Organizations
that understand the key drivers of a healthcare experience use the best data they
can gather. Although many organizations still base these decisions on a variety of
factors, benchmark institutions always start with the patient and make sure every
decision is based on a thorough knowledge and understanding of the patient.
Feedback
Benchmark organizations also know that the discovery process is never ending, so
they constantly seek feedback from their customers about what works and what
does not. Patient needs, wants, and expectations change, and the best organizations
change as well in response to evolving patient expectations. Those organizations
that constantly seek to exceed patient expectations build in their own future chal-
lenges. Todays extras are tomorrows standard patient expectations.
Outstanding organizations are constantly trying to outdo their present perfor-
mance, and they survey customers constantly to determine how well they are satis-
fying their key drivers. For example, a medical group practice had a long history of
complaints and frustrations associated with a paper scheduling system for patient
appointments. As a result of survey data from three customer groups (i.e., physicians,
394 Achieving Service Excellence
staff, and patients), a new online appointment system was installed. Success indica-
tors were then developed to evaluate the results of the new system, focusing on key
drivers suggested by each of the three customer groups. Signicant improvement in
satisfaction of all three customer groups resulted from this process.
Culture
Managers of outstanding organizations should remember the importance of the
organizational culture in lling in the gaps between what the organization can
anticipate and train its people to deal with and what actually happens in the daily
encounters with a wide variety of patients. Anticipating the many different things
patients will do, ask for, and expect from the service provider is impossible.
Thus, the power of the culture to guide and direct employees to do the right
thing for the patient becomes vital. Good managers know that the values, beliefs,
and norms of behavior the culture teaches its employees are critical in ensuring that
the patient-care staff do what the organization needs them to do in unplanned and
unanticipated situations, even if the organization has no specic policies relevant
to that situation.
The culture must be planned and carefully thought through to ensure that the
message sent to all employees is the one the organization really wants to send. An
important part of any strategy is to ensure that everything the organization and
its leadership says and does is consistent with the culture it wishes to dene and
support. The more intangible the healthcare product, the stronger the cultural
values, beliefs, and norms must be to ensure that the provider delivers the quality
and value of healthcare experience the patient expects and the organization wants
to deliver.
Service or Price
In the future, healthcare organizations will tend to compete on service or price
even more than they do now. A successful group of organizations in every service
sector will seek to add value to each customer service encounter (like the strategy
of Pearle Vision) or seek to dene value on price alone (like the strategy of discount
opticals). By focusing on a particular niche of the market, advertising to that niche,
and then serving that niche well, these companies (like Southwest Airlines and
retail health clinics) will thrive. However, healthcare organizations typically market
their services based on some combination of clinical effectiveness, service quality,
Chapter 15: Leading the Way to Healthcare Service Excellence 395
and (possibly) price. In other words, they market based on value received rather
than price alone.
Low-cost providers may appeal to price-conscious consumers by using technol-
ogy to become more efcient. High-cost providers can increasingly customize the
product to each patients expectations at the price point plus offer a little bit more
because they can provide their employees with the necessary information to per-
sonalize the service in a prompt, friendly, and efcient way.
The healthcare businesses between these two ends of the spectrum will have the
most difcult challenge. They will be challenged to offer patient services that are
as personalized as those offered by the high-cost organizations, while providing the
low prices that the price-oriented rms offer. This middle group of organizations
may do neither very well. They may nd themselves in the position of overprom-
ising and underdelivering, which is not the way to have satised, loyal, or repeat
patients.
STAFFI NG
Stafng has become an increasingly important factor for all healthcare organiza-
tions as they realize that the most effective way to differentiate themselves from their
competitors is through the quality of the service encounters the patient-contact
staff provide. Competitors can readily imitate the service product, the physical
elements of the environment, and the technical aspects of the delivery system,
but not the people. For example, each hospital or clinic may have nearly the same
physical equipment as every other hospital/clinic. It will not take long for one hos-
pital or clinic to duplicate the factor that makes its competitor successful. Any new
machine or system is an innovation only for as long as it takes the competition to
replicate it.
Employee Engagement
People, not MRI technology, make the difference. If one clinic has friendly em-
ployees and another clinic does not, customers will go to the friendly one, unless
their HMO requires the second. When all other factors are equal, or nearly so, the
healthcare staff make the difference. The challenge for healthcare managers is to
empower the service provider to engage each patient on a personal, individual basis
while still maintaining production efciency and consistent quality in the service
delivery process.
396 Achieving Service Excellence
For example, a pharmacist is responsible for lling prescriptions exactly as pre-
scribed in an efcient fashion that respects a patients time constraints. He can han-
dle the transaction in an impersonal manner (barely speaking to the patient). Al-
ternatively, the patient can be engaged in a conversation about other prescriptions,
any allergic reactions to drugs, the weather, or inquiries about family members (if
known to the pharmacist). If the pharmacist just processes people, he may become
bored. If he engages them, the job becomes more interesting. The latter approach
is much more likely to enhance the patients relationship with the provider and to
make way for a healthcare experience that exceeds expectations.
The division will widen between organizations that can engage all the capa-
bilities of its employees and those who use employees only from the neck down.
Value added to the healthcare experience through the skills of employees engaging
in service encounters will become a more important differentiating strategy as the
decreasing costs and increasingly available technology make the healthcare product
and service delivery system components (except for people) increasingly easy to
duplicate and emulate by all competitors. If all eye exams are essentially alike, the
feel-good part of the eye exam becomes an increasingly important part of the total
experience.
Advertising alone cannot provide this difference and, in fact, may be counter-
productive if patients do not encounter what the glowing ads lead them to expect.
Staff members can make the difference that patients remember. If your patients
continue to think and speak well of you, you must be doing something right. If
they do not speak well of you and do not hold your organization in high regard,
then implementing the principles outlined in this book will move you toward
healthcare excellence. If their continued high regard is vital to your organizations
survival, you better nd a way to keep it.
Selection and Training
Some employees gure it out, engage their customers, and actually do have fun.
They are usually the ones who were selected properly in the rst place. Finding the
right people for patient-service jobs is an important responsibility of the selection
process. Putting the right people in these jobs eliminates many of the problems in
delivering high-quality healthcare experiences. Some people are just plain good
at quickly establishing personal contact with patients, and they can be identied
through effective selection techniques. Finding these people and training them in
both the cultural values and the basic engagement skills necessary for effective ser-
vice delivery are key responsibilities for healthcare human resources managers.
Chapter 15: Leading the Way to Healthcare Service Excellence 397
Recall that patient-contact employees have three responsibilities in the service
encounter: They deliver the service (or in some cases create it on the spot), they
manage the quality of the encounters or interactions between the patient and the
organization, and they identify and x the inevitable problems. Too many orga-
nizations train only for the rst responsibility and neglect the other two. In many
instances, receiving the service product is just one element in the patients determi-
nation of the quality and value of the experience. Employees must also be trained
to deal effectively with the variety of personalities and concerns that different pa-
tients will bring to the healthcare experience.
Selecting the right person for the job starts by clearly dening what the job
requires. If you want a person to be a receptionist, who serves as a pleasant, rea-
sonably informed rst point of contact for new patients, then hire someone with
a certain bundle of skills. If you want a person to be a triage decision maker, who
not only serves as the rst point of contact but also decides who needs immediate
treatment and who does not, then hire someone with skills different from those
of a good receptionist. Leaders should also allow peers to participate in selection
interviews as these are the people who will be working with the new employee.
Studer (2008) has recommended re-recruiting new employees at 30- and 90-
day intervals. The purpose of these 30- and 90-day interviews is to make sure that
the employee is on board, her expectations are being met, and the goals of both
supervisor and employee are aligned. On-board means the employee has bought
into the goals, requirements, and behavior of staff members necessary to imple-
ment a customer-service culture. A major purpose is also to enhance retention of
new employees, as they often leave within the rst three months.
The second part of the stafng issue is training. Studer (2008) recommends
that leaders be trained rst, because it makes no sense to train employees and align
their behavior with the organizations mission, vision, values, and strategies if the
top management team is not also aligned. The right person in the right job must
be trained to do it the right way. Some jobs in the healthcare industry are repeti-
tive, simple, and boring; others are also repetitive and boring but complex instead
of simple. Both require incredible attention to detail and concentration on task
performance so the employee provides the same healthcare experience in the same
awless way for each patient.
An employee can easily lose focus, daydream, or otherwise lose interest in tak-
ing blood from the 30th person of the day. By that time, his arms are tired, his
attention span is short, and his interest in greeting one more patient with a friendly
smile and positive eye contact is about zero. Part of that employees training should
include how to cope with the emotional labor that is part of these jobs (Larson and
Yao 2005).
398 Achieving Service Excellence
When the encounters are shortas in a visit to the lab or the billing ofcethe
training challenge is particularly difcult because the staff member must know
how to build a connection to the patient quickly. The use of scripts or scripted
behaviors is one way organizations help employees respond appropriately to the
different expectations of different patients, even when the employee may be bored,
tired, or stressed out.
Rewards and Recognition
Service excellence requires that rewards and recognition be provided for lead-
ers and staff who demonstrate high levels of service excellence. Studer (2008)
recommends identifying low performers, middle performers, and high perform-
ers. For high performers, he suggests more training and development as well as
more recognition and rewards. For low performers, he suggests conversations
that identify deciencies and possible ways the employee must enhance her per-
formance. However, in some cases the person may have to be dismissed from the
organization if performance does not improve. For the middle level of perform-
ers, he suggests continuing conversations, measuring performance, and reward-
ing performance as it improves.
The advantage service organizations like healthcare offer to employees over
typical industrial settings is the positive feedback and stimulation that dealing with
patients can bring, especially when employees know that what they do may make
the difference between sickness and health or life and death. Once employees learn,
through experience or training, how to derive some sense of satisfaction out of
doing something that makes a patient happy, they enjoy their jobs and feel a sense
of accomplishment.
In addition to their paid employees, benchmark organizations rely on volunteers
to provide some of the patient contact. Volunteers may be better able to engage
patients and their families because they have more time to do so. The only ques-
tion is whether they are provided with appropriate rewards and recognition that
motivate them to do so. Recent empirical research indicates that volunteers can
and do make signicant, positive contributions to patient satisfaction (Hotchkiss,
Fottler, and Unruh 2009). Many healthcare organizations have discovered that
some of their best volunteers are older, retired people who are often lonely, bored,
and looking for something to do that will allow them to have positive contact with
other people. Some organizations that originally recruited older people because of
labor shortages have found to their pleasant surprise that many older people bring
an enthusiasm for service that makes them great employees.
Chapter 15: Leading the Way to Healthcare Service Excellence 399
Obviously, all staff members are volunteers in the sense that they can choose to do
more than the minimum required by their job description or not. They work under a
wide variety of nancial or nonnancial rewards, including personal recognition. If or-
ganizations are able to identify and respond to these needs by providing valued rewards
and recognition, they are more likely to achieve higher levels of customer satisfaction.
More and more healthcare employees are looking for job challenges and in-
creased opportunities to be responsible for the patient encounter. The need to trust
the employees and allow them to take on this responsibility will intensify as the
competition for talented employees becomes greater. Good people want to take the
responsibility, and successful organizations are those that nd ways to preserve the
quality and value of the healthcare experience while empowering their employees
to be responsible for patient satisfaction.
Allowing playfulness is an important approach to reward and recognition that
enables staff to release tension in stress-lled settings. Furthermore, most people
like to celebrate, and employees are no different. Celebrations of success can take
the form of parties, balloons, banners, pictures of the honored managers and staff,
and recognition dinners. No success should be allowed to pass unnoticed.
Finally, a customer-focused reward and recognition system requires an excel-
lent performance appraisal system. Because what is measured and rewarded is
managed, leaders should be continually checking on the performance of their
subordinates based on objective measures of the individuals customer service
and other key performance attributes. In addition, the performance evaluation
system needs to be tied to compensation and other rewards valued by the subor-
dinates. Finally, the organization needs to continually monitor employee satis-
faction and take steps to remedy any deciencies to enhance employee retention
and respond to employee concerns.
Standards of Behavior and Performance
One way to ensure understanding of and agreement with the organizations com-
mitment to a customer service mission is to require that before being hired, all job
applicants read and sign a performance standards agreement that species, among
other things, the customer service standards expected by the organization. This
performance standards agreement should be based on input from all employees,
align individual behavior with strategic goals and mission, use specic language,
hold people accountable, and be updated periodically.
A large part of a managers job is to dene employees job responsibilities, goals,
standards of performance, and managements expectations of what behaviors match
400 Achieving Service Excellence
the organizations culture. These must be clearly spelled out, dened with specic
metrics, and reinforced and rewarded by managers every day.
Once a manager lets an employee provide service of less than outstanding quality or
overlooks poor employee performance, the message goes out to everyone that managers
do not always really mean what they say about providing high-quality customer service.
Just as a patient has many moments of truth during the course of a single healthcare
experience, employees have many moments of truth with every manager every day.
What happens during these moments of truth tells the employees a great deal about
what management really believes in. This is where the organizational mission statement,
corporate culture, and corporate policies about customer focus become real.
Just as one employee at one moment of truth can destroy the patients perception
of the entire organization and what it stands for, so too can one supervisor overlook-
ing one violation of patient-care quality standards or job performance change the way
an employee looks at an organization. Although most organizations do a good job of
developing selection techniques and providing the necessary job training, many fall
short in the reinforcement area. When they let things slide, they miss the chance to
reinforce the positive and coach away the negative aspects of employee performance.
Many outstanding organizations require their managers to be in their job areas
walking the walk and talking the talk; it is a vital part of how the message is sent
to employees that everyone is responsible for customer service, including the man-
agers. This policy also builds a sense of community among the employees in that
everyone is there to serve the customer.
Patient and Family
Just as organizations can benet from thinking of their employees as customers,
they can also benet from thinking of their customers as employees. It gives the
organization a different way of looking at and thinking about their customers if
they dene them as quasi-employees.
Customer-employees can serve several important functions. They can be knowl-
edgeable unpaid consultants, as they give helpful feedback to the organization re-
garding their level of satisfaction with the healthcare experience. They can help
create the service experience for other patients, as they are typically part of the ser-
vice environment. If being surrounded by other patients is a necessary part of each
patients experience, then how these customer-employees are used to help create
each others experience becomes an important part of the management process.
Most important, with encouragement and training from the organization, cus-
tomers can become coproducers of their own service experience. Coproduction
Chapter 15: Leading the Way to Healthcare Service Excellence 401
benets both the patient and the organization. It reduces the labor costs for the
organization, and knowledgeable patients (perhaps with the help of their family
and friends) are likely to receive a better healthcare experience because they helped
produce it. In addition, patients do not have to wait for some services that they can
do on their own.
SYSTEMS
The best, most thoroughly trained people in the world cannot satisfy a patient if
they deliver the wrong medicine, operate on the wrong body part, or provide the
wrong therapy perfectly. A huge, complex system (like a university teaching hospi-
tal) and a simple system (like a dental clinic) both have to be carefully managed so
the right product is delivered to patients when they expect it to be.
Patients do not care that the room is not ready yet because the laundry broke
down, or that the organization misplaced a medical shipment so they cannot get
the drugs they need, or that the staff specialists are unavailable because someone
forgot to schedule them. The patient just wants a clean room, the right medicine,
and the right specialist, and the patient wants those now. If these things do not
happen, then the production system, the support system, the information system,
or the organizational system has failed, and someone needs to x itfast.
Models
The most highly developed applications related to providing an excellent healthcare
experience can be found in the clinical systems area. Models of patient behavior in
many situations can be built and used to understand and predict ways in which the
organization can best treat the patients medical condition. Such clinical models
can be extended into modeling all aspects of the healthcare experience. Simulations
are an important technique for doing this, and with the decreasing costs of com-
puters and increasingly user-friendly software packages, simulations will become
more available and relevant to all types of healthcare organizations.
Once the planning process has gotten the design right and the measurement
systems are in place to get patient feedback, the stage is set to use simulations of the
entire healthcare experience to see if it all works as a system. Organizations need to
ensure that the right capacity has been built into their service delivery system. The
design-day selection and the parameters used (such as maximum wait times) drive
the rest of the capacity decisions.
402 Achieving Service Excellence
Because customers are not impressed by excuses such as the computer system
is down today, backup systems need to be in place so that customers are not
inconvenienced. Having managers go through the service delivery process like pa-
tients sensitizes them to potential problems. In many organizations, the most vis-
ible part of the healthcare experience is the wait for care. This wait system, there-
fore, requires extra organizational time and attention to ensure that the inevitable
waits are tolerable and within the limits patients will accept without becoming
dis satised.
Waiting Times
Waiting periods are easily modeled and studied with simulation techniques and
easy-to-use computer software. Everything from the number of beds in a hospi-
tal to the number of physicians on duty in an ED to the number of phone lines
needed at an HMO call center can be simulated based on patient demand data. If
you know how many patients are coming to your place of business and can esti-
mate a predictable distribution to represent their arrival patterns and times for ser-
vice, modeling how the waiting experience can be managed and balanced against
capacity is relatively simple.
Managing the waiting time is important from the capacity standpoint and the
psychological standpoint. Because few can build enough capacity to serve peak de-
mand periods, and few can stockpile their mostly perishable and intangible prod-
uct, managing the patients wait is critical for all organizations. The greater the per-
ceived value of the healthcare experience, the longer the patient will wait. Again,
this area is susceptible to empirical research; how long patients will wait for any-
thing before they give up and leave can be studied, measured, and understood.
Measurement
The excellent organizations of the future will use every tool at their command to
gure out what patients want and then provide it in a way that is consistent with
the patient expectations of value and quality. If they promise a high-quality health-
care experience that includes friendly service, they better provide those features or
patients with other options will not come back. Most organizations depend on the
high regard of their patients, and disappointing them will cost dearly in a competi-
tive marketplace.
Once you tell your customers what you will do for them, you have made a com-
mitment and a promise. If the promise is broken or the commitment unrealized,
Chapter 15: Leading the Way to Healthcare Service Excellence 403
patients will be unhappy and will tell everyone they know how unhappy they are.
Few organizations can afford to break their promises, and the more an organization
depends on a good reputation and positive word of mouth, the less chance it can
take of violating that trust.
Information and opinions about service quality are freely and widely available
now and will become even more so in the future. If a dissatised patient posts a
negative comment on the Web about a service, that comment is readily accessible
to anyone with Internet access. The more the Internet is involved in helping con-
sumers select a healthcare provider, the more critical it becomes to avoid service
failures.
Some major healthcare organizations now have an employee whose only job
is to monitor discussion groups and blogs on the Internet to detect and hopefully
correct patient complaints and false rumors that show up. A job classication that
did not even exist ten years ago is becoming an increasingly important part of the
organizations communication strategy as it seeks to monitor and address the nega-
tive word of mouth or misinformation that now travels instantly across cyberspace
to the entire world.
Measurement is crucially important because what gets measured gets managed
and improved. As noted earlier, feedback given in various forms from both employ-
ees and patients is critical. In this way, the total healthcare experience is transpar-
ent, individual behavior is aligned with strategic goals, people are held accountable
for achieving these goals, and the organization is able to show progress over time.
Consistent Improvement
The future will be information management, people management, an increasing
focus on understanding what each patient really wants (a market niche of one
that allows the organization to build a relationship with each patient), and a focus
on the organizational core competencies that satisfy these patient expectations.
The future will also bring forth more knowledgeable customers with ever-rising
expectations. The more competitors in a marketplace try to outdo each other in
providing superb healthcare experiences, the more familiar these experiences will
become.
Yesterdays exceptional experience becomes todays expected minimum level
of service. Healthcare managers will need to engage the entire organization in
constantly reviewing all aspects of the customer service product, strategy, en-
vironment, and stafng of the service delivery system to innovate new and not
easily duplicated features that make the future patient experience as memorable
as todays.
404 Achieving Service Excellence
The easiest and most fruitful area in which to develop these features is in the
interaction between staff and patients, where healthcare employees can elevate an
expected experience into something that is truly memorable. The challenge here
is to empower them to provide that unique extra touch without jeopardizing the
quality and consistency of the clinical experience. Human error is inevitable, and
the need to blend technology and people to provide a high-tech and high-touch
experience of consistently high quality will be the biggest and most interesting
challenge for the future healthcare manager seeking excellence in the healthcare
experience provided.
Finally, service recovery is crucial. Because no organization is perfect, providing
multiple methods for customers to communicate problems is necessary. The cost
of losing a patient, as well as his family and friends, far exceeds the immediate costs
of making things right.
THE ROLE OF LEADERS
We end this chapter by stressing an idea that has been implied throughout this
book: Managers must lead staff toward excellence. The leader is the symbol and
teacher of what the organization stands for and believes. If the leader does not lead,
all the efforts to discover the key drivers that cause the customer to seek out a par-
ticular healthcare experience; the expense of designing a healthcare environment;
the resources dedicated to building, maintaining, and constantly improving a ser-
vice delivery system; and the effort to recruit and train the best people are wasted.
Every day and in every way, the leaders must set the example and consistently com-
municate to all employees what their value is to the organization and to its mission
of creating the healthcare experience.
Everyone wants to feel that what she does has value and meaning to a purpose
larger than enriching a companys top executives and stakeholders. Leaders not
only inspire their staff to realize their individual worth to the organization but
also help staff see how they contribute to the greater good by doing their jobs with
excellence. Telling people how important it is that they do their jobs well is not
enough; all employees must understand and believe that their contributions make
a difference and that doing well, whatever they do, is vital in making the world a
better place.
Many organizations make efforts in this direction, but only a few succeed.
These benchmark organizations inspire their employees to believe they are respon-
sible for saving lives, relieving human suffering, and healing many who would not
otherwise return to health. These organizations constantly remind all employees
Chapter 15: Leading the Way to Healthcare Service Excellence 405
that what they are doing has a greater purpose than merely giving shots, cleaning
rooms, or emptying bedpans.
Each job has value, and the person doing the job has value because of the contri-
bution to the larger purpose. This is a vital part of inspiring people not only to do a
job but to do it with pride and commitment. Not every employee will be deeply af-
fected, but this idea is planted in so many healthcare employees minds that it creates
the strong cultural reinforcement that focuses everyones attention on producing an
excellent experience for each patient. This is a powerful leadership technique and a
valuable way to ensure that everyone stays focused on the patient.
The commitment and enthusiasm of great organizational leaders is contagious
and leads to involvement and passion among all organizational members. Leaders
nd ways to make employees feel that their jobs are fun, fair, interesting, and im-
portant. Leaders establish a culture of service excellence and reinforce it by word,
deed, and celebration. Leaders give value to employees by showing them they are
appreciated and respected for their contributions to the organization and to the
larger purpose toward which the organization aspires. Leaders have the joy and the
responsibility of making it all happen: happy, motivated staff members; outstand-
ing healthcare experiences; and highly satised patients whose loyalty, goodwill,
and positive word of mouth in the community form the foundation of organiza-
tional service and performance.
Common sense and research suggest that a relationship exists among the be-
havior of organizational leaders, how employees feel about their jobs, and how
that feeling is translated into the level of service they provide. If staff members
feel positive, they provide a high level of service. Creative, high-quality service for
patients links directly to patient opinions, and these opinions are a key part of any
organizations success. This chain reaction all starts with the leaders. In the organi-
zational units where employees rate their leaders as outstanding in such behaviors
as listening, coaching, recognition, and empowerment, the patient satisfaction rat-
ings are invariably the highest.
Finally, the leader blends the strategy, staff, and systems so everyone knows he
is supposed to concentrate on patients and other customers. The strategy, stafng,
and systems must be carefully managed if the combined effort is going to succeed
in providing an outstanding total healthcare experience. If the leader sees that any
element is not contributing to the employees ability to provide outstanding experi-
ences, the leader will x it or have it xed.
Just as the organization wants to x any patient problem that detracts from
the healthcare experience, the outstanding leader wants to x any staff members
problem that detracts from that persons ability to provide the outstanding health-
care experience. Vision, skills, incentives, delivery system, and measurement are
406 Achieving Service Excellence
leadership components that leaders must manage if they are to meet this challenge
effectively. As noted in Exhibit 15.2, all must be present to produce and maintain
highly satised customers. More specically, leaders must do the following:
Defne an organizational vision of what patient segment is to be served and
what service concept will best meet customer expectations (vision).
Establish a customer-focused culture to enhance clinical excellence (vision).
Communicate the organizations mission and vision to all customers on an
ongoing basis through a wide variety of methods (vision).
Select employees with service-oriented attitudes, and train them in the
necessary clinical and customer service skills (skills).
Train staff to exceed customer expectations on an ongoing basis using scripts,
role playing, and other training methods (skills).
Create standards of behavior and performance, and hold staff accountable for
upholding these standards (incentives).
Create and implement the incentives that will motivate empowered employees
to provide unsurpassed customer service (incentives).
Establish a service recovery system that empowers all staff to identify and
rectify all customer service problems (incentives).
Communicate and celebrate all individual and group successes (incentives).
Ensure that employees have the proper resources to provide outstanding
service (resources).
Create a clean and attractive environment for all customers (delivery system).
Design specifc delivery systems that translate plans, employee skills, and
resources into an experience that meets patient expectations and perhaps even
wows the patient (delivery system).
Focus on employee retention and patient retention (measurement).
Provide the measurement tools that allow employees (and coproducing
patients) to see how well they are doing in providing the targeted or desired
healthcare experience (measurement).
Use data generated from the measurement tools to continually identify and
implement improvements in customer service, because success is never nal
(measurement).
Measurement is critical for ensuring that all factors of service are correctly fo-
cused on achieving the best for the patient. Simply, if you do not know how you
are doing, you do not know if you need to do better, and you do not know how to
do better. If you try to improve patient service, you do not know if you have suc-
ceeded unless you implement measurement techniques. Continual improvement is
also necessary given that momentum can easily be lost.
Chapter 15: Leading the Way to Healthcare Service Excellence 407
Exhibit 15.2 shows how the customer and the customers experience can be
negatively affected when leaders fail to manage any one of these important leader-
ship components. However, negative outcomes can be prevented. Just as service
problems happen in the best-managed organizations, so can patient-contact staff
of poorly managed organizations sometimes provide successful healthcare experi-
ences in spite of the organization and its faults. When one or more leadership
components are missing, however, the chances of consistent service success are
reduced. The exact effect on the healthcare experience may not be predictable in
precise terms, but it will not be a happy one.
Exhibit 15.2 also shows how a missing leadership element can affect employees.
Although managers will do as good a job as they can of managing the nonhuman
elements, their ability to change them may be limited. If the clinic is already con-
structed and the laboratory set up, the clinic manager may not be able to manage
the service environment and the mechanical parts of the delivery system much.
In a way this is good news because it enables managers to focus on the people
part of the healthcare experience: the patients as part of the environment for each
Exhibit 15.2 Leadership Components
Finally, the leader blends together the strategy, staff, and systems so
that everyone knows that they are supposed to concentrate on patients
and other customers. The strategy, staffing, and the systems must be
carefully managed if the combined effort is going to succeed in pro-
viding the outstanding healthcare experience that the healthcare organ-
ization was established to provide. If the leader sees that any element
is not contributing to the employees ability to provide outstanding
experiences, the leader will fix it or have it fixed.
Just as the organization wants to fix any patient problem that
detracts from the healthcare experience, the outstanding leader wants
to fix any staff members problem that detracts from that persons
ability to provide the outstanding healthcare experience. Vision,
skills, incentives, delivery system, and measurement are leadership
416 achi evi ng servi ce excellence
Figure 15.1 Leadership Components
Skills + Incentives + Resources + Delivery System + Measurement Vision
= Unfocused Employees = Unfocused Service = Confused Customers
Vision + Incentives + Resources + Delivery System + Measurement Skills
= Untrained Employees = Probable Failed Service = Disappointed
Customers
Vision + Skills + Resources + Delivery System + Measurement Incentives
= Unmotivated Employees = Lackluster Service = Disillusioned
Customers
Vision + Skills + Incentives + Delivery System + Measurement Resources
= Unsupported Employees = Inadequate Service = Complaining
Customers
Vision + Skills + Incentives + Resources + Measurement Delivery System
= Unreliable Employees = Unreliable Service = Unsatisfied Customers
Vision + Skills + Incentives + Resources + Delivery System Measurement
= Uninformed Employees = Inconsistent Service = Unfulfilled
Customers
Vision + Skills + Incentives + Resources + Delivery System + Measurement
= Unsurpassed Employees = Superb Service = Highly Satisfied
Customers
Fotter/book 8/12/02 3:47 PM Page 416
408 Achieving Service Excellence
other, the patients as they participate in creating their own experiences, the clini-
cal and staff as they try to provide outstanding customer experiences, and all other
support staff as they provide the assistance that their internal customers require.
These many and ever-changing elements of the healthcare situation require and
deserve each managers attention.
If the organizations leaders lack an overall vision of the target market and its
expectations, this lack will be communicated from the top throughout the culture
and may lead to unfocused service. Staff members will not be sure exactly what
they are trying to achieve, and patients will receive mixed messages and an incon-
sistent experience. If managers put untrained people in patient-contact positions,
service failures and disappointed patients are the probable result. If incentives are
lacking or inappropriate, unmotivated staff will simply go through the motions of
providing lackluster healthcare experiences.
Failure to provide resource support for all staffclinical and nonclinicalwill
prohibit even a motivated and patient-focused staff from providing adequate ser-
vice. Similarly, aws in the delivery system will keep even the best personnel from
providing reliably satisfactory healthcare experiences, much less superb ones; as the
saying goes, A bad system will defeat a good person every time.
Finally, if levels of service quality and patient satisfaction are not measured,
employees will be frustrated by not knowing whether the healthcare experiences
they are providing are achieving the healthcare mission or not; so in a hit-or-miss
fashion, they will continue to provide inconsistent service.
Only when these components are all in place can the leader be effective in en-
abling and empowering employees. Only then can empowered employees provide
the outstanding healthcare experiences that fulll the organizational vision of pro-
viding remarkable service that exceeds patient expectations. Every manager, from
the chief executive ofcer to the frontline supervisor, must ultimately make sure
that employees feel good about what they are doing, that they convey this feeling
to patients, and that patients leave knowing the experience was worth every penny
paid and maybe a little bit more. Leadership makes the difference between success
and failure in todays healthcare organizations, and it will make the difference in
the future.
CONCLUSI ON
The healthcare experience, despite all its componentsservice product, service
setting, and service delivery systemis not complete without the patient. With-
out the patient, the carefully designed service product; the detailed and inviting
Chapter 15: Leading the Way to Healthcare Service Excellence 409
setting; the highly trained, motivated staff; and the nest facilities and equipment
are just part of an experience waiting to happen. Throughout this book, we have
made the point that everything starts with the patient. We conclude by saying that
everything ends with the patient as well.
Service Strategies
1. Start with the customerboth external patients and internal staff
members.
2. Articulate a vision, transcending any single job, that gives all staff a sense
of value and worth in what they do.
3. Manage all three parts of the organizations service systemstrategy,
stafng, and systemsand focus them on achieving strategic goals related
to customer service.
4. Build a strong customer service culture and sustain it with stories, deeds,
and actions.
5. Organize, staff, train, and reward around the patients needs, wants, and
expectations.
6. Train all staff to think of the people in front of them as their guests.
7. Ensure that jobs are fun, fair, and interesting to help employees provide
superb experiences.
8. Keep in mind the strong relationship between highly satised employees
and highly satised patients.
9. Incorporate customer satisfaction skills into employee training programs.
10. Never stop teaching; inspire everyone to keep learning.
11. Establish a standard of performance, measure it, and then manage it
carefully.
12. Use information to improve strategy, stafng, and service elements
identied by customers as decient.
13. Link customer satisfaction scores to management and employee rewards
and recognition.
14. Prevent every service problem you can, nd every problem you cannot
prevent, and x every problem you nd every time and, if possible, on
the spot.
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411
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431
Index
Access, 78, 9
Accountability, 168
ACSI, 15
Action plans: areas for, 68; performance
criteria, 6869; purpose, 69;
service strategy, 6769
Added value, 10
Administrative skill, 199
Advanced information systems, 25559, 260
Advertising, 241
AI, 25859
Alignment audit: core elements, 7374; cues,
7174; framework, 7374;
organizational factors, 69, 71; questions,
7576; steps, 74; strategic plan, 53
Allied health professional: shortages, 133
Ambient conditions, 9596
American Customer Satisfaction Index. See
ACSI
Anxious waits, 324
Apology, 377
Application form, 149
Appointment: wait time, 303
Arrival pattern, 31314
Arrival rate, 320
Articial intelligence. See AI
Assessment: service excellence model, 4023
Assets, 6162
Attitudinal training, 18182
Avenger, 364
Background checks, 15253
Behavioral change, 174
Beliefs, 1067
Benchmarking, 14546
Benchmark service organizations: lessons
from, 1819
Benet package, 141
Biophilic design, 87
Blueprint: explanation, 27983; playground
injury treatment, 282
Brainstorming, 5758
Branding, 120
CAHPS, 14
Callback, 14344
Capacity day, 31112
Capacity planning, 5657
Career development, 186
Case-study format, 176
CDSS, 257, 258
Chief customer ofcer, 15
Classroom training, 17576
Cleanliness, 96
Clinical decision support system. See CDSS
Clinical/task competency, 151
Clinician: interaction, 89; service delivery
system component, 43
Cognitive response, 102
Comment cards, 34446
Commitment, 110
Competencies: areas of, 137; customer service/
communication, 13738;
hidden, 137; staff, 13638
Competency-based benchmarking, 14546
Competition: as recruitment source, 143
Competitive advantage: achievement, 11; culture
as, 114; customer service as, 35
Complaint behavior, 373
Complaints: data utilization, 36768; most
common, 34; welcoming, 3334, 36465
Computer-based training programs, 17879
Concierge medicine, 2122, 9192
Conscientiousness, 14647
Consumer Assessment of Healthcare Provider
and Systems. See CAHPS
432 Index
Consumer: condence of, 5; informing, 240
41; role changes, 21718
Consumer-driven healthcare: market trends,
1617; reform and, 384, 38687
Content mastery testing, 174
Continuous quality improvement. See CQI
Control, 7
Control factors, 23132
Convenience, 78
Coproduction: advantages/disadvantages,
22428, 230; costbenet
analysis, 23233; determinants, 23035;
patient roles, 222; perspective on, 228
29; reasons for, 23132; service excellence
model, 400401
Core competencies: culture and, 114;
denition, 60; internal
assessment, 6061
Costbenet analysis, coproduction, 23233
Cost: evidence-based design, 83; savings, 247;
total healthcare experience, 48
CQI: accreditation criteria, 12
Critical incident: explanation, 46; skills, 151;
survey technique, 35253
Critical path, 288, 289
Critical skills, 168
CRM, 3132
Cross-functional organization, 29395, 296
Cross-functional training, 181
Cues, 71, 73
Cultural competence, 8
Cultural norms, 1078
Culture: basic elements, 10610; changing,
12426; communication of, 11720;
conversions, 12526; denition, 105;
importance of, 11317; leaders role, 110
13; patient-centered, 11213; practicing,
11213; reinforcement, 12123; teaching,
12024; translating, 112
Customer: defection, 36364; denition
of, 4; expectations, 12; focus, 2122;
information, 241; loyalty, 911; types, 13
Customer contact: group, 253; improvement
strategies, 45;
scheduled time for, 124
Customer relationship management. See CRM
Customer service: chain, 2830; expectations,
13; fundamentals, 19; mission statement
and, 64; retreats, 180; Web-based
technology, 242
Customization, 8
Decision making: culture and, 116; facilitating,
25758; Internet and, 24546; process
stages, 20911
Decision modeling, 256
Decision systems, 25556
Delphi technique, 58
Demand management, 3067, 369
Design day, 56, 31011
Distributive fairness, 378
Diversity training, 18182
Econometric models, 55
ED: triage, 3067; wait time, 302
Electronic medical record: breach of, 26263;
Web-based technology, 24142
Emergency department. See ED
Emotional commitment, 14647
Emotional response, 1023
Employee: acknowledgment of, 190;
behavior, 70, 399400; coaching, 196;
contributions of, 13235; desires,
194; development programs, 18487;
empowering, 132, 20714; engagement,
39598; feedback, 33738; general
abilities, 14647; healing environment,
8889; job analysis process, 13538; job
crafting, 14748; mission-focused, 192
94; motivation of, 18994; outputinput
ratio, 19293; performance rewards,
19899; performance standards, 399
400; personorganization t, 14849;
recruitment process, 13844; retention,
15356; rewards/recognition, 39899;
satisfaction, 117, 15354, 19498;
screening methods, 14953; selection,
14449, 39698; service delivery, 43;
service lovers, 13435; shortages, 13334;
survey, 19698; training, 39698; work
teams, 2017
Empowerment: benet, 207; degrees of,
208; electronic recordkeeping, 247;
explanation, 208; job content/context
grid, 20811; organizational limitations,
213; Point B strategy, 21012; potential,
Index 433
21314; program implementation,
21213
Environment: assessment, 52, 59; dimensions
of, 94100; factors, 8182;
sounds, 9596
Evangelist, 364
Evidence-based databases, 25253
Evidence-based design, 8283, 8384
Expectations: awareness of, 12; external
customers; 3035; internal customers,
35; management of, 3233; variability, 33
Experience economy, 24, 4042
Expert systems, 25659
External assessment, 5459
External customer, 3035
External environment, 11415
External training, 17374
15foot rule, 107
Family: role of, 219
Feedback: employee, 33738; service
excellence model, 39394;
training, 17273
Fellowship program, 18687
Financial compensation policies, 200
Finders fee, 141
Fishbone analysis, 28385
Flowchart, 280
Focus group: coproduction strategy, 221;
qualitative assessment, 58, 338;
recruitment, 141
Folkways, 109
Food service: trends, 91
Forecasting, 5459, 369
Formalized learning, 169
Functional congruence, 97
General abilities, 14647
General education, 18586
Globalization, 1718
Green movement, 9293
Guestology, 2627
Guest service representatives, 90
Healing environment: creation approaches,
86; effects of, 83; elements conducive to,
8485; employees and, 8889; family-
friendly designs, 85; humor and, 8788;
nature and, 85, 87
Health advice: Web-based technology, 24142
Healthcare database, 243
Healthcare Effectiveness Data and Information
Set. See HEDIS
Healthcare hours, 151
Healthcare organization, as information
system, 26468
Healthcare support group, 253
Health information systems. See Information
systems
Health insurance: rating service, 15; Web-
based technology, 241
Healthplexes, 9394
Healthscape, 43
HEDIS, 14
Heroes, 11819
High-involvement work environment, 117
Homelike design, 85
Hospital: rating service, 1415
Hotel-style amenities, 9091
Human resources system: organizational
culture and, 123
Humor, 8788
Individual needs assessment, 171
Inducements, 200201
Information: bad, 261; condentiality,
26163; electronic expertise, 25253;
level-to-level ow, 25355; overload,
26061; primacy of, 265; security, 261
63; service delivery system, 351; service
environment, 25051; service product,
24950; on service quality, 25152;
sharing, 247
Information ow: increasing, 26566; intranet
utilization, 26667; reducing need, 266
Information system: advantages/disadvantages,
260; customer-contact group, 253;
decision systems, 25556; expert systems,
25659; healthcare organization as,
26468; healthcare support group,
253; information ow, 25355;
interconnectivity, 26768; learning cost,
264; problems with, 25964; service
delivery, 43; value of, 24041; value
434 Index
versus cost, 26364
Information technology: growth, 24149;
patient access, 243; personalized service,
24849; smart card, 249; Web-based
strategies, 24142
Intangible services, 3839
Integrated systems, 26768
Interaction: behavioral guidelines, 108; caring
approach, 89; matrix, 37
Interactive fairness, 378
Internal assessment, 53, 6062
Internal customer: expectations, 35; metrics,
35051
Internal environment, 11415
Internal training, 17374
Internet: decision-making aid, 24546;
electronic recordkeeping, 247; growing
role of, 24149; pharmacy, 241;
providerconsumer connectivity, 248;
telemedicine, 24647; as tool, 24448
Interview, 14951, 35153
Inventory management services, 250
Job analysis, 13536
Job content/context grid, 20811
Job crafting, 14748
Key drivers, 30, 70, 39092
Knowledge, 168
Knowledge, skills, and abilities. See KSA
KSA, 13536, 145, 218
Laws, 11718
Leader: development, 16062; role of, 406;
service excellence model, 4048
Leadership components, 407
Lecture, 17576
Legends, 11819
Lighting, 96
Loyalty, 911, 8994
Mail surveys, 34647
Management by walking around. See MBWA
Management observation, 33337
Manager: competencies, 61; intervention,
19495; retention role of, 15455;
skills, 199201
Market trends, 1118
MBWA, 333
Medical errors, 263
Medical record, 247
Medical staff. See Staff
Medical status, 41
Medical tourism, 17
Medication errors, 254
Mental abilities, 146
Mentorship program, 18687
Migration, 59
Mission, 52
Mission statement, 63, 6465, 123
Moderators, 100101
Moment of truth, 4446
Monetary cost, 48
Monte Carlo simulation, 31819
Mores, 109
Motivation: of employees, 18994
Music, 9596
Mystery shoppers, 35455
Nature, 85, 87
Needs assessment, 17072
Neighborhooding technique, 85
Noise, 95
Norms, 1078
Nurse: care teams, 204; job crafting, 14748;
shortages, 133; retention, 155
Occupied time, 32324
Ofce visit: owchart of, 280
Ombudsman, 33738
On-the-job training, 17778
Opportunity cost, 48
Orientation, 181
ORYX: measurement data, 1213
Outcome fairness, 378
Outputinput ratio, 19293
Palliative care, 222
Pareto analysis, 283, 285, 286
Patient: collaborator, 2223; consultant, 22021;
control factors, 23132; coproduction, 225
Index 435
28, 230; decision making, 233; denition
of, 4; environment, 22122; expectations,
69; ring of, 23435; involvement strategy,
21924; manager, 22324; motivator, 223;
participation, 7; quasi-employee, 21819;
remote monitoring, 38; satisfaction, 11314,
117; service excellence model, 400401;
service failure role, 362; stakeholder, 5; time
perception, 23132; training, 165, 17273;
voice of, 56
Patientdoctor relationship, 247
Patient-involvement movement, 1617
Peer interview, 150
Perception, 8182
Performance: appraisal, 195, 196;
improvement, 7273, 19596;
measurement, 1215; reporting, 1516;
rewards, 19899; standards, 341, 344,
37071; 399400
Personal control, 6
Personal health record. See PHR
Personal interviews, 35152
Personality: dimensions, 152
Personalized service, 24849
Personorganization t, 14849
PERT/CPM diagram, 28792
Pharmacy: Web-based technology, 241
PHR, 244
Physical environment, 79
Physical production tools, 43
Physician: training feedback, 17273
Physiological response, 1012
Poka-yoke, 37172
Preference card, 6667
Primary care: independent practices, 2122;
provider shortage, 388; service excellence
and, 19; retainer, 9192
Primary customer, 4, 3035
Procedural fairness, 37778
Professional associations, 14142
Professional networking sites, 153
Providerconsumer connectivity, 248
Providers: Web-based technology, 241
Psychological tests, 15152
Public trust, 5
Qualitative assessment: advantages/
disadvantages, 33435; employee
feedback, 33738; focus groups, 338;
management observation, 333, 33637;
service guarantees, 33840;
techniques, 5759, 33340
Quality: cost of, 49; equation, 47;
improvement, 12, 247; total healthcare
experience, 4748; service strategy
factor, 6667; teams, 36970
Quality assessment: public metrics, 35556;
qualitative methods, 33340; quantitative
methods, 34055; technique utilization,
35657
Quantitative assessment: advantages/
disadvantages, 34243; comment cards,
34446; critical incidents, 35253;
internal customer metrics, 35051;
mystery shopper, 35455; performance
standards, 341, 344; personal interviews,
35152; surveys, 34650; techniques,
5557, 34055; telephone interviews,
353; Web-based survey, 353
Quasi-employee, 21819
Queue: discipline, 314; simulation, 31719;
types of, 31417
Queuing theory, 31319
Re-hires, 141
Readmissions, 222
Recordkeeping: electronic, 247
Recruitment: challenges, 134; creative
approaches, 14044; external candidates,
140; internal candidates, 13840; process
evaluation, 144; sources, 14144
Reference checks, 15253
Referrals, 241
Regression analysis, 55
Reimbursement reform, 38889
Reimbursement system, 1920
Report cards, 1314
Reporting, 93
Respect, 6
Retail clinics, 8
Retail model, 21
Retention, 15356
Retraining, 180
Rewards/recognition, 19899, 39899
Risk, 230
Risk cost, 48
436 Index
Rituals, 11920
Roleplaying: sessions, 167; training method,
18081
Rounding, 333, 336
Safeguards, 167
Satisfactionloyaltyoutcomes chain, 29
Scenario building, 5859
Scripts, 12122
Secondary customer, 4
Self-directed work team, 204
Self-inspection, 371, 372
Self-insurance, 17
Self-management, 116
Service delivery system: analysis, 27478;
cross-functional organization, 29395;
design review, 27273; shbone
analysis, 28385; information and, 251;
organizational components, 4346;
Pareto analysis, 283, 285, 286; PERT/
CPM diagram, 28792; planning
techniques, 27893; self-correcting, 273;
simulations, 29293
Service excellence: benchmark organizations,
1819, 20; challenges, 1920;
characteristics, 27; fundamental concepts,
2124; monetary reward, 20
Service excellence model: competition,
39495; consumer-driven healthcare,
384, 38687; culture, 394; feedback,
39394; framework, 385; healthcare
reform, 384,38687; key drivers,
39092; outcome documentation, 387;
patient extras, 39293; planning, 393;
reimbursement reform, 38889; stafng,
395401; strategy, 38995; systems,
4014
Service failure: customer defection, 36364;
customer response, 36466; data,
36768; dollar value, 366; elements of,
36064; patients role, 362; sources, 361
Service product: components, 4243;
information and, 24950;
tangible versus intangible, 3637
Service providers: customer interaction, 3738;
empowerment, 3940
Service quality: capacity design and, 3045;
factors, 159; information on, 25152;
participation and, 23031
Service rate, 320
Service recovery: employee-driven strategies,
37577; impact, 367; outcomes, 363;
outcome strategies, 37475; patient
evaluation, 37778; preventive strategies,
36872; principles, 375; problem
severity, 38081; process strategies,
37273; strategy characteristics, 37881;
suggestions, 376
Service setting: environmental dimensions of,
94100; importance of, 8082; overview,
43; purpose of, 80; trends, 8994
Service strategy: achievement, 67; action plans,
6769; overview, 6566; quality, 6667;
value, 6667
Service time, 314
Servicescape, 43, 100103
SERVQUAL, 34750
Shopping: Web-based technology, 241
Signs, 9899
Simulation, 29293, 36970
Smart card, 249
Social networking, 153, 24344
Social responsibility, 8
Source inspection, 371, 372
Spatial conditions, 9798
Special competencies training, 181
Stakeholders, 45
Statistical forecasting, 55
Strategic planning: alignment audit, 6974;
process, 5254
Structured questions, 151
Students: as recruitment source, 142
Subculture, 10910
Successive inspection, 371, 372
Surveys, 338, 34650, 353
Symbols, 99, 11920
Task needs assessment, 171
Telemedicine: Internet and, 24647; Web
based technology, 24142
Telephone interviews, 353
Themes, 8990
Third-party payer, 45
Time factors, 23132
Time savings, 247
Time series analysis, 55
Index 437
Total healthcare experience: cost, 48; quality
of, 4748; service delivery system, 4346;
service product, 4243; service setting,
43; value of, 4849
Total quality management. See TQM
TQM: goal, 274; lessons learned, 272
Training: attitudinal, 18182; barriers, 166;
benets, 163, 166, 184; classroom
presentation, 17576;
components, 162; computer-based
learning, 17879; cost analysis, 184;
cross-functional, 181; customer service
retreats, 180; diversity, 18182; external
versus internal, 17374; feedback,
17273; frontline staff, 163; job
instruction technique, 178; leaders,
16062; measurements, 17475,
18384; methods, 17583; objective,
172, 183; on-the-job supervision,
17778; orientation, 181; patients, 165;
problems/pitfalls, 18384; retention
impact, 16466; roleplaying method,
18081; service excellence model,
39698; service recovery strategy,
36970; special competencies, 181; staff,
16266; turnover impact, 16466; video
instruction, 17677
Training program: big picture reinforcement,
16869; components, 17075;
continuous improvement, 170;
development guidelines, 16768;
formalized learning, 169; multiple
learning approaches, 170
Transactional administrators, 191
Transactional leaders, 111
Transactional skill, 199
Transformational leaders, 11112, 191
Transformational leadership skill, 200
Trend analysis, 55
Triage, 3067
Tuition reimbursement policy, 185
University collaboration, 141
Value: congruence, 148; differential, 11;
equation, 48; of total healthcare
experience, 4849; perceived, 9; service
strategy factor, 6667;
Values: customer-focused, 1067; examples of,
52; cultural reinforcement, 11516
Video training, 17677
Virtual wait strategy, 308
Vision, 52
Vision statement, 6264, 123
Wait management: perceived service value,
32728; perceptions, 32328; practices,
322
Wait time: for appointment, 303; capacity
decision, 30412; denition, 300;
diversions, 3078; ED, 302; importance
of, 300303; management, 31223;
organizational options, 30512; patient
dissatisfaction with, 3012; physician,
3023; queuing theory, 31319; service
time versus, 324; solo versus group, 326;
standards, 30910; tracking, 310;
for treatment, 303; uncertain lengths,
325; uncomfortable waits, 326;
unexplained waits, 325; unfair, 32526;
uninteresting, 326; virtual strategy, 308;
capacitydemand balance, 319, 32123;
service excellence model, 402
Waiting area: hotel-style amenities, 9091;
improvements, 3089
War gaming, 5859
Web-based survey, 353
Word of mouth, 36566
Work team: benets of, 2014; characteristics,
202; nursing care, 204; problems, 2045;
self-directed, 204; utilization, 2067
Yield management, 57
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439
About the Authors
Myron D. Fottler, PhD, is a professor and executive director of the Health Services
Administration Programs in the College of Health and Public Affairs at the University of
Central Florida, where he teaches courses in healthcare human resources management,
service management and marketing, and dissertation research. His research interests
include all aspects of human resources management, service management, stakeholder
management, strategic management, integrated delivery systems, and healthcare
report cards. He has won awards from the American College of Healthcare Executives,
American Association of Medical Administrators, and the Healthcare Management
Division of the Academy of Management for his research. His publications include 18
books and more than 100 journal articles.
Previously, Dr. Fottler was professor and director of the PhD program in
AdministrationHealth Services, with a joint appointment in both the School of
Health Related Professions and the School of Business at the University of Alabama at
Birmingham. He completed his MBA at Boston University and his PhD in business
at Columbia University. He has been active in both the Academy of Management
and the Association of University Programs in Health Administration. He has also
served on several editorial review boards and is a founding coeditor of Advances in
Health Care Management, an annual research volume published by JAI/Elsevier.
Dr. Fottler has served as a member of the editorial boards for Medical Care Research
and Review, International Journal of Applied Quality Management, Journal of Health
Administration Education and Health Care Management Review. He has served as a
reviewer for Industrial and Labor Relations Review, Industrial Relations, Academy of
Management Review, Medical Care, Journal of Management, Journal of Occupational
Behavior, Health Services Research, Hospital & Health Services Administration, Health Care
Financing Review, Journal of Management Studies, Journal of Healthcare Management,
Journal of Labor Studies, and Academy of Management Journal. He has been listed in
numerous biographical publications, including Dictionary of International Biography,
Whos Who in The World, Outstanding Young Men in America, Whos Who in the East,
Contemporary Authors, International Directory of Business and Management Scholars
and Research, American Men and Women of Science, International Writers and Authors
Whos Who, and Directory of American Scholars.
440 About the Authors
Robert C. Ford, PhD, is a professor of management in the College of Business
Administration at the University of Central Florida (UCF). He joined UCF in 1993
as chair of the Department of Hospitality Management, and, until 2003, he was
associate dean for Graduate and External Programs. He also served on the management
faculty of the University of North Florida and was management department chair
and a member of the faculty at the University of Alabama at Birmingham.
Dr. Ford has authored or coauthored more than 100 articles, books, and
presentations on organizational issues, human resources management, and services
management, especially as it relates to healthcare and hospitality applications.
He won the 2001 Sodexho Marriott Health Care Division Faculty Publication
of the Year for a coauthored article with Myron Fottler. He has published in a
wide variety of academic and practitioner journals, including the Journal of Applied
Psychology, Academy of Management Journal, Organizational Dynamics, Health Care
Management Review, and The Academy of Management Executive. His books include
Principles of Management, Organization Theory, Managing the Guest Experience
in Hospitality, Achieving Service Excellence, Leading with a Laugh, and Managing
Destination Marketing Organizations.
Dr. Ford was editor of the Academy of Management Executive and chair of both
Management History and Management Education and Management Development
Divisions of the Academy of Management. In addition, he has been the chair of
the Accreditation Commission for Programs in Hospitality Administration. He is
a Fellow and former dean of the Southern Management Association.
Cherrill P. Heaton, PhD, was a professor of organizational communications at the
University of North Florida. In addition to teaching organizational and business
communications in the MBA and M.Acc. programs, he taught more than 100 short
courses for business and industry in these areas. He was editor of Management by Objectives
in Higher Education and was coauthor of Essentials of Modern Investments and several
articles and three books (with Robert Ford): Principles of Management, Organization
Theory, and Managing the Guest Experience in Hospitality. In addition, Dr. Heaton was
managing editor of the Academy of Management Executive. He is now retired.

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